Federal Financial Aid

U.S. Department of Education and Federal Student Aid logo (Proud Sponsor of the American Mind)


Students wishing access to federal financial aid must:

  • be a US Citizen or an eligible non-citizen
  • be enrolled as a regular student in an eligible program
  • be beyond compulsory school age and/or possess a valid high school diploma or equivalent
  • be clear of any default or overpayment on a federal student loan or federal Pell Grant, and
  • have a valid social security number

Maintaining Eligibility

Once considered eligible to participate in the federal financial aid program(s), students must maintain eligibility by:

  1. demonstrating satisfactory academic progress as published in the school catalog, and
  2. continuing to not be in default or overpayment of previous federal aid programs.

Failure to satisfy eligibility criteria may result in a loss of federal aid.

If interested, applicants should contact our Financial Aid Department for further explanation of eligibility criteria.

Applying for Financial Aid

All federal financial aid is accessed through the Free Application for Federal Student Aid (FAFSA) and is the first step in acquiring federal financial aid. The FAFSA is an electronic application located on https://www.studentaid.gov.  A paper version of the FAFSA can be obtained from our Financial Aid Office, high school counselors and most libraries for those who cannot complete the electronic version.

Parents of dependent students may wish to access the federal PLUS loan. This loan is only available to parents of dependent students. The federal PLUS loan requires an additional application which can be provided by our Financial Aid Dept. or view more information here about the PLUS loan

In addition, parents/students may choose to access loans via outside/private lenders. Outside/Private education loans are subject to the lender’s application and qualification criteria.


Awarding federal financial aid is influenced by a mathematical formula called ‘Needs Analysis’. This is a measurement of the student’s ability to pay educational expenses based on the analysis of the student’s FAFSA data using a formula mandated by Congress. Each student’s FAFSA is unique therefore the Needs Analysis is specific to the student. The results of Needs Analysis is reflected in what is known as the Expected Family Contribution (EFC).

Once the EFC is known, the next step is to determine the student’s ‘Financial Need’. Financial Need is defined as the difference between the Cost of Attendance (COA) and the Expected Family Contribution (EFC).

The COA is developed by the School and includes both direct (tuition, books, and fees) and indirect (room and board, transportation, and miscellaneous personal expenses) costs. COA budgets are influenced by program length and the student’s living arrangements. COA budgets are updated annually. For current COA budget information, please contact our Financial Aid Office or click here to view our Cost of Attendance information.


Overawards occur when the student has received more federal aid than earned. In many cases, the school’s obligation to return funds resolves the issue, however, there are situations where the student has been given funds that must be returned to the Dept of Education.

Students are notified of an overaward by the school. The student has 45 days from the date the school notified the student or should have notified the student of the overaward to make a ‘positive action’ toward repayment. The student retains financial aid eligibility during the 45 day action deadline. If the student does not enter into a repayment plan by the end of the 45 day period, the school will report the student to NSLDS as an over payment and refer the student to the Default Resolution Group for collection.

Two positive action options

  1. Students may repay the overpayment in full to Omega Studios’ School
  2. A repayment agreement can be signed with the Department

*Note: Omega School has opted not to exercise its right to not participate in a repayment agreement with students in order to resolve the overaward. All repayment agreement requests will be referred to the Default Resolution Group

Consequences of not taking positive action within deadline

  1. The student loses financial aid eligibility for additional Title IV funds
  2. The School must report the student to NSLDS as on overaward and refer the file to the Default Resolution Group for collection

Academic Year

Omega Studio’s School defines its academic year as 900 clock hours and 30 weeks. All financial aid is based on grade level one (1) award limits.

Clock Hour

A clock hour is defined as an hour of instruction, including a maximum of 10 minutes break time for each clock hour. Break time may vary according to the nature and participation requirements of the particular class; i.e. lecture, small group, individual instruction, etc.

Types of Federal Aid Offered at Omega Studio’s School


Pell Grant awards are gift monies from the US Dept. of Education that do not have to be paid back. They are ‘Need Based’ therefore recipients must demonstrate ‘Financial Need’ as discussed earlier. The minimum and maximum Pell Grant are established by Congress and by the US Dept. of Education. Taking Advantage of the Pell Grant is the first step in awarding federal aid. To access Pell Grant, the student must submit a FAFSA. Pell Grant is awarded on an annual basis from July 1st to June 30th of each year. Length of program, cost of attendance, expected family contribution and lifetime usage influence the Pell Grant award.



Federal Direct Stafford Loans are monies borrowed directly from the Dept. of Education and must be repaid. Federal student loans are not credit based. Students wishing to borrow from the federal student loan program(s) must submit a FAFSA and meet the eligibility criteria mention earlier in this catalog. Subsidized loans are ‘Need Based’ therefore recipients must demonstrate ‘Financial Need’.

There are two types of federal Direct Stafford Student Loans – Subsidized and Unsubsidized. Subsidized loans are Need Based and Unsubsidized loans are not. Both loans offer a six (6) month grace period; have a fixed interest rate; can be paid off early without penalty; are eligible for certain types of deferment, forbearance and cancellation; offer a variety of repayment plans; and are subject to a loan fee charged by the federal government. Interest accrues on both loans with each disbursement, however the interest on the Subsidized loan is paid by the federal government while the student is in school, during the 6 month grace period and during periods of deferment. The federal government never pays the interest on the Unsubsidized loan.

Loan awards are subject to federal regulation and determined by the Financial Aid Department on an individual basis. Deciding factors include EFC, loan type, COA, dependency status, program length, grade level and federal loan history. The combined Subsidized and Unsubsidized maximum loan amounts for grade level one are $5,500 for dependent students and $9,500 for independent students.

Prior to disbursing, loan applicants must complete entrance counseling and submit a Master Promissory Note (MPN). These are submitted electronically via https://www.studentaid.gov/entrance-counseling/or https://www.studentaid.gov/mpn/

More information about federal student loans including repayment, repayment calculations, terms and conditions can be found on www.studentaid.gov/repay-loans. Information on loan limits can be found on:





To notify the US Dept. of Education of a student’s wish to borrow from its loan program(s), the School will submit information via the National Student Loan Data System (NSLDS) as required by federal regulation where it may be accessed by authorized agencies, lenders and institutions.

Federal student loans must be repaid. The consequences of defaulting on a federal student loan can be severe. For more information, please visit https://studentaid.ed.gov/sa/repay-loans/default



PLUS loans are monies borrowed directly from the Department of Education and must be repaid. These loans are only available to parents of eligible dependent students; are credit based; have a fixed interest rate; are not ‘Need’ or income based; require an additional application; and require additional authorizations from the parent. The PLUS ‘Authorization for Credit Check’ is the application used to request the PLUS loan. This application may be obtained from our Financial Aid Office or by submitting an electronic application via the link provided by clicking here.

Maximum PLUS loan amounts are governed by federal regulation and may not exceed the COA minus all anticipated financial aid.

Repayment typically begins sixty (60) days after the final disbursement, but borrowers may request payment be deferred until after the student completes. PLUS loans do not have a six (6) month grace period like the student loans.

Prior to disbursing, the parent borrower must complete a Master Promissory Note via https://studentloans.gov/mpn.

As with the student loans, the School will notify the US Dept. of Education of the parent’s requested loan amount via the National Student Loan Data System (NSLDS) as required by federal regulation where it may be accessed by authorized agencies, lenders and institutions.


Verification is the process of confirming the accuracy of specific information entered onto the FAFSA. Most verifications are selected by the US Department of Education, however Omega Studio’s School may choose to verify certain FAFSA elements as well. Selection for verification is often prompted by:

  • Random selection
  • Certain edits established by the US Dept. of Education, or
  • Conflicting information

Completing verification often involves providing additional information to our Financial Aid Office. In some cases, federal aid may not be disbursed until verification is completed. It is important to complete verification as soon as possible.

There are different types of verification which confirm the accuracy of different types of information. The verification type and required items to verify are determined by regulation. When selected, students are notified in writing and provided a list of needed actions/documentation to satisfy verification.

Typically, students/applicants are required to provide verification materials within two weeks of receiving written notice. We understand verification documents may need to be provided by outside sources not under the student/applicant’s control therefore program starts and disbursement delays may occur. It is important to alert the Financial Aid Office when experiencing difficulty in securing needed verification items. Under all circumstances, verification must be completed within 120 days of the student’s last day of attendance or by the annual deadline established by the US Dept. of Education, whichever is earlier.

Delays in completing verification within the two week deadline may require the student to make cash payments or seek other funding sources to meet his/her financial obligation to the School. A student’s failure to complete verification may result in the loss of all or a portion of his/her financial aid.

If verification creates a change in award(s), the Financial Aid office will notify the student in writing of those changes within two weeks of completing verification.

Schools are required by federal regulation to report suspicion of aid requested under false pretense to the US Department of Education. Omega Studio’s School takes its stewardship of federal funds very seriously and will cooperate with government agencies in the prosecution of students and parents found to have falsified application data. If the School becomes aware of a student having received more financial aid than they were entitled to, Omega Studio’s School will make every effort to collect the overpayment from the responsible party. If they fail to return the overpayment, the School will refer the case to the US Dept. of Education for collection.


Financial aid is disbursed by payment period. To qualify for subsequent payment of federal aid, students must successfully complete the clock hours and weeks of instruction within the payment period to progress to the next payment period. According to federal regulation, ‘‘a student ‘successfully completes’ clock hours if your school considers the student to have passed the coursework associated with those hours’. It is important to distinguish between Satisfactory Academic Progress (SAP) and the criteria for disbursement. SAP concerns itself with completed courses and corresponding grades. Disbursing criteria requires the student to have passed all coursework associated with the clock hours within the payment period with a passing cumulative grade average. Financial aid disbursements may be delayed until the student demonstrates ‘successful completion’.

A disbursement is made when the student’s ledger is credited with a payment. Pell and PLUS funds are typically credited within the first 2 weeks of class start. Student loan funds usually arrive within 40 days of class start. Second disbursements are planned when the student attends class at least one day after successfully completing the hours and weeks in the first payment period and demonstrates Satisfactory Academic Progress (discussed elsewhere in this catalog). Payment period completion is determined by actual hours attended.

Federal Credit Balances

A federal student aid credit balance occurs when the amount of federal aid received exceeds the student’s tuition and fees for the payment period (reference 10.30.15 final regulations). By regulation, the School must disburse federal credit balances within fourteen (14) days of occurrence unless the student has withdrawn. When a student withdraws, the school is required to perform a return calculation to determine whether adjustments to the credit balance will occur. For this reason, the fourteen (14) day deadline is placed on hold. Permission from the student or parent is not required in order to place a hold on a credit balance. Once the R2T4 calculation is completed, the fourteen (14) day deadline will commence. Checks are mailed to either the student or parent (as instructed) to the address on file. It is the student and/or the parent’s responsibility to update their mailing address with the school.

Loan Counseling

Loan counseling is required of all federal direct student loan borrowers and can be completed on paper through the school’s Financial Aid office or via the federal website https://studentloans.gov . Loan counseling occurs at start (Entrance) and upon completion (Exit). While both types of counseling discuss various aspects of the loan program, Exit counseling also collects information from the student. The school uses an internal document to list multiple contacts for the student which will be shared with the loan servicer, if needed. The student will also fill out an internal Exit counseling form acknowledging the obligation to complete electronic counseling, his/her servicer name and contact information, how much money was borrowed, grace period start and end dates, first payment due date and current contact information for the student and 2 references . These documents are copied and maintained in the student’s financial aid file.

Interest Rates

Federal Direct Loan interest rates are fixed and calculated in accordance with formulas specified in the laws and regulations that set the terms and conditions of Direct Loans. When the rates are calculated, they apply to all loans for which the first disbursement is made during the period beginning on July 1 of one year and ending on June 30 of the following year.

Each loan has a maximum fixed interest rate(or capp). The maximum interest rates are –

8.25% on Direct Subsidized and Unsubsidized loans made to undergraduates.

9.50% on Direct Unsubsidized loans made to graduate students

10.5% on Direct PLUS loans made to graduates, professional students, and parents of dependent undergraduate students

Loan Limits

Annual loan limits in the Direct Subsidized and Unsubsidized Loan Program vary depending on your academic year, grade level, and dependency status and other factors, such as

  • The length of your program
  • Your cost of attendance
  • Your Expected Family Contribution (EFC)
  • Other financial aid you receive, and
  • Your remaining eligibility under the annual and aggregate loan limits

Direct PLUS loans do not have fixed limits. You can borrow up to the school’s cost of attendance minus all other financial assistance received. The school determines the amount a PLUS borrower may access.

Repayment Your Direct Subsidized and Unsubsidized Loans

Loans must be paid back. Borrowers select a repayment plan through their servicer and make payment to the Loan Servicer.

Students are not required to make payment while enrolled at least half time. Direct Subsidized and Unsubsidized loans have a six month grace period whereas the borrower is not required to begin repayment until he/she has been out of school for six (6) months.

Sample Repayment Plans

  • Standard Repayment Plan – available to all borrowers, applies to all loans, allows up to 10 year term with a minimum monthly payment of $50
  • Graduated Repayment Plan – available to all borrowers, applies to all loans, allows up to 10 year term with monthly payment amounts increasing every two years

There are a number of other repayment plans to choose from that are income driven. For more information on these plans, borrowers are encouraged to talk with their loan servicers or visit https://studentaid.ed.gov/sa/repay-loans/understand/plans

Estimated Monthly Payments for Direct Student Loans (source: Entrance Counseling Guide July 2015)
Debt When Loan Enters Repayment

Interest Rate 4.99%

Per MonthTotalPer MonthTotal

Repayment of your Direct Loan is a serious financial obligation. When you make payments on time, you begin establishing a credit history that will affect your future eligibility to obtain loans for things such as cars and homes. When you apply for a job, employers often use your credit history as a way to measure how you meet your responsibilities and your ability to establish and stick to a plan.

Falling behind on your Direct Loan payments can have serious consequences:

  • Loans become delinquent the first day after you miss a payment
  • A loan that is delinquent for 270 days goes into default
  • Loans that are delinquent or go into default are reported to national credit agencies

Consequences of default on federal education loans include

  1. Immediate loss of all federal financial aid
  2. Wage garnishment
  3. Attachment to your federal tax refund
  4. Indefinite notification of a defaulted loan on your credit history until resolved
  5. Limited ability to discharge via bankruptcy

Financial Aid Rights and Responsibilities

Students participating in federal financial aid programs have certain rights and responsibilities that may impact the student’s decision to participate. Copies of these rights and responsibilities are published in the federal Exit Counseling and the federal Entrance Counseling Guides available through our Financial Aid office

Financial Aid Rights and Responsibilities are as follows:

You have the right to

  • Written information of your loan obligations and information on your rights and responsibilities as a borrower;
  • A copy of your MPN either before or at the time my loan is disbursed.
  • A grace period and an explanation of what this means;
  • Notification, if the Department transfers your loan to another servicer without your consent;
  • A disclosure statement before you begin to repay your loan, that includes information about interest rates, fees, the balance you owe, and a loan repayment schedule;
  • Deferment or forbearance of repayment for certain defined periods, if you qualify and if you request it;
  • Prepay your loan in whole or in part anytime without an early repayment penalty; and
  • Documentation when your loan is paid in full

You are responsible for

  • Completing exit counseling before leaving school or dropping below half time enrollment;
  • Repaying your loan according to your repayment schedule even if: you do not compete your academic program; you are dissatisfied with the education received; or you are unable to find employment after you graduate;
  • Notifying your lender or lean servicer if you
  • Move or change address
  • Change your phone number
  • Change your name
  • Change you social security number, or
  • Change employers or your employer address and/or phone change
  • Making monthly payments on your loan after your grace period ends, unless you have a deferment or forbearance; and
  • Notifying your lender or loan servicer of anything that might alter our eligibility for an existing decrement or forbearance.

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