Tennessee Tech Financial Aid Outreach Coordinator Joe Clark said new federal regulations will require the university to adjust student loan payouts based on the specific number of credit hours a student takes each semester.
Clark said the 2027-2028 FAFSA will become available October 1 and will utilize tax information from 2025. He said while the application process remains the same, the way federal aid pays out has shifted to a model that tracks enrollment more closely throughout the academic year.
“Under the new rules, the way this works now is that we now have to look at how many hours a student is registered for for this school year,” Clark said. “And so the loans will now adjust to match the number of credit hours a student is enrolled in.”
Clark said students previously received full loan disbursements as long as they were registered for at least six credit hours. He said the university must now assume a student’s spring enrollment will match their fall enrollment to determine initial eligibility for the year.
“I think from a government standpoint it’s them trying to keep students from accepting too much of their loan,” Clark said. “I think is really the goal.”
Clark said the new rules require a student to reach 24 credit hours per year to receive their full loan amount. He said if a student takes nine hours in the fall, the university must recalculate and adjust the loan downward unless the student increases their credit load in the spring.
“For example, if a student is taking nine credit hours in a semester, say the fall semester, they’re not going to receive that full semester amount that they would normally get because they’re not at 12 credit hours,” Clark said. “Now, obviously, when spring comes around, if they register for say 16 credit hours and they go over 24 hours then we would readjust everything so we would recalculate.”
Clark said Parent PLUS loans are excluded from the credit-hour adjustment rules but now face new annual and lifetime borrowing caps. He said parents are limited to $20,000 per year per dependent student with a total lifetime limit of $65,000.
“Which means that if a parent for instance or student, parent and student rely on the Parent PLUS loan each year and they take out the max each year which is $20,000, they’ll essentially be out by their senior year, right?” Clark said. “Because 65 and 20 per year don’t line up exactly right.”
Clark said the university recommends families cap Parent PLUS borrowing at $16,250 per year to ensure funding remains available for all four years of a degree program. He said students whose total non-federal aid meets or exceeds their cost of attendance budget will also no longer be eligible for the federal Pell Grant.
“But they would have to have enough aid to cover their COA without that Pell included, you know?” Clark said. “So like I said it can happen but it’s not going to be something that affects a large number of students.”
Clark said students can check with the Tennessee Tech financial aid office to see if they qualify for legacy provisions that might grandfather them into previous rules. He said the Tennessee Tech scholarship application for the 2027-2028 cycle is already open for students to seek additional funding.
“It’s been a long time since there have been rule changes like this when it comes to the FAFSA and how financial aid pays out from federal end,” Clark said. “So what I’ll say is if anyone does have any questions they can reach out to me at any time.”
Former and current students can reach out to Clark at [email protected] if they have any questions about federal loan aid changes.