Savanna Hoffman
The CARES Act (Coronavirus Aid, Relief, and Economic Security Act) provides colleges with emergency grants to help students cover expenses related to the disruption of campus operations due to COVID-19. These grants are not loans and do not need to be paid back. Students do not need to submit documentation or verification to the Department of Education (ED) after completing their FAFSA. However, they will be contacted by the ED if any documents are missing. The CARES Act also affects the way student loans are treated, suspending all required payments on federal student loans through September 30, 2020, with no interest accruing during this time.
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What You'll Learn
Students do not need to pay back the grant
The CARES Act, or the Coronavirus Aid, Relief, and Economic Security Act, was signed into law in March 2020. The Act provides for the suspension of payments for federal student loans and the distribution of emergency grants to students. These grants are not loans and do not need to be paid back.
The CARES Act's Higher Education Emergency Relief Fund (HEERF) provides colleges with emergency grants for their students. These grants are meant to cover expenses related to the disruption of campus operations due to the COVID-19 pandemic. The grants are not included in a student's gross income and are therefore non-taxable.
The eligibility criteria for these grants vary slightly between institutions. However, some common criteria include being enrolled in a financial aid-eligible program, being a US citizen or eligible non-citizen, and having incurred expenses related to the disruption of campus operations due to the pandemic. Some institutions also require students to have a certain attendance average, such as 12+ hours per week.
The amount of the grant also varies between institutions and is often determined based on the number of applications received and the total amount requested. Some institutions prioritize students with the greatest need, while also establishing a maximum funding threshold to ensure the funds are distributed as widely as possible.
It is important to note that while the CARES Act grants do not need to be paid back, they also cannot be used to cover outstanding balances on student accounts. Students are encouraged to use these grants to cover their emergency personal expenses, such as food, housing, course materials, technology, healthcare, and childcare.
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Eligibility criteria for the grant
The Coronavirus Aid, Relief, and Economic Security (CARES) Act provides colleges with emergency grants for their students. These grants are not loans and do not have to be paid back.
- Students must be enrolled in a degree-seeking program (undergraduate, CLIMB, or graduate).
- Students must be eligible to receive Title IV federal aid.
- Students must be enrolled in the semester for which the grant is being provided. For example, for the Fall 2021 grant, students must be enrolled in the 2021 Fall semester.
- Students must not be enrolled in a fully online program.
- Students must have incurred expenses due to the disruption of campus operations caused by the COVID-19 pandemic. This includes expenses related to housing, food, course materials, technology, healthcare, or childcare.
- Students must not have Pell grant overpayments or federal loan defaults.
- Students must complete a statement of educational purpose and verify their identity (SSN), if required.
- Students must not be dual enrollment or early admission high school students.
- Students must be U.S. citizens or eligible non-citizens.
- Students must be enrolled in a financial aid-eligible program.
- Students must be current with all required Financial Aid Eligibility Forms.
- Students must not be in default on a Federal Student Loan.
- Students must be enrolled in at least 1 credit hour for the semester.
The eligibility criteria may vary slightly depending on the specific college or university. For instance, Oakland University requires students to file a 2020-21 FAFSA to be eligible for the grant, while Drexel University excludes Drexel Online, International, PhD, Certificate, and DACA students from eligibility.
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How to apply for the grant
The Coronavirus Aid, Relief, and Economic Security (CARES) Act provides emergency grants to students through the Higher Education Emergency Relief Fund (HEERF). The grants are meant to cover expenses related to the disruption of campus operations due to COVID-19, such as food, housing, health care, and childcare. These grants are not loans and do not need to be paid back. They are also not included in your gross income and are therefore non-taxable.
To apply for the grant, you must meet the basic eligibility criteria for federal student aid programs. Here are the steps to apply for the CARES Act grant:
- Enroll in an eligible program: You must be enrolled in a financial aid-eligible program. For example, at Debutantes School of Cosmetology and Nail Technology, you must be enrolled in the Cosmetology or Esthetics program. Check with your school to confirm which programs are eligible for the grant.
- File a FAFSA application: You must file a Free Application for Federal Student Aid (FAFSA) to demonstrate financial need. The FAFSA application will determine your eligibility for federal student aid programs. Make sure to complete and file the FAFSA for the correct academic year. For example, for the 2020-2021 academic year, you would need to file the 2020-2021 FAFSA.
- Demonstrate financial need: The CARES Act grants are prioritized for students with the greatest financial need. When applying, be sure to provide documentation and evidence of your financial situation to demonstrate your need for assistance.
- Enroll in face-to-face courses: Students enrolled exclusively in online or distance education programs are generally not eligible for the CARES Act grants. You must be enrolled in face-to-face courses to be eligible for the grant.
- Be a U.S. citizen or eligible non-citizen: International students are typically not eligible for the CARES Act grants. You must be a U.S. citizen or meet the requirements for eligible non-citizen status to apply for the grant.
- Contact your university's financial aid office: Each university may have specific instructions and requirements for applying for the CARES Act grant. Contact your university's financial aid office to inquire about the application process and any additional criteria or documentation they may require.
It is important to note that the availability of funds and eligibility criteria may vary depending on the university and the specific grant program. Be sure to review the guidelines provided by your university and reach out to their financial aid office for further guidance on how to apply for the CARES Act grant.
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The grant cannot be used to pay off student loans
The CARES Act, or the Coronavirus Aid, Relief, and Economic Security Act, provides emergency grants to students to cover expenses related to the disruption of campus operations due to the COVID-19 pandemic. These grants are not loans and do not need to be paid back. However, they cannot be used to pay off student loans.
The CARES Act provides broad relief for federal student loan borrowers. Under the Act, all required payments on federal student loans were suspended from March 13, 2020, through September 30, 2020, with no interest accruing during this period. This provision was intended to provide financial relief to students who were struggling to make their monthly payments due to loss of income or other financial hardships brought about by the pandemic. While payments were suspended, borrowers who were able to continue making payments were encouraged to do so through their loan servicer's account to help them pay off their loans faster.
The CARES Act also expanded the Education Assistance program to include temporary student loan payment assistance. This expansion allows employers to contribute up to $5,250 per year for current education expenses for employees without creating a tax impact. While this provision does not provide direct grants to pay off student loans, it does offer a form of loan payment assistance that can help borrowers reduce their debt.
There are other grants and scholarships available specifically for paying off student loans. For example, the National Institutes of Health (NIH) offers Loan Repayment Programs (LRPs) that provide up to $50,000 per year to doctoral-level researchers in various fields. Various branches of the military also offer loan repayment programs for eligible active-duty members, such as the Army, Navy, Air Force, and National Guard. Additionally, there are scholarships and grants specifically for students of color and first-generation students who are burdened by student loan debt. These programs aim to provide financial assistance and help students take charge of funding their education.
While the CARES Act grants cannot be used to directly pay off student loans, the suspension of federal student loan payments and the expansion of the Education Assistance program provided some relief to borrowers during the COVID-19 pandemic. Additionally, there are other grants, scholarships, and loan repayment programs available to help individuals manage and reduce their student loan debt.
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The grant is not considered financial aid
The CARES Act grants are not considered financial aid. These grants are federal grants that can be used to help cover expenses, allowing students to focus on their education and meet their academic goals. They are not included in a student's financial aid package.
The grants are not loans and do not have to be paid back. They are also not included in a student's gross income and are therefore non-taxable. Students cannot claim any deduction or credit for expenses paid with the grant, including the tuition and fees deduction, the American Opportunity Credit, or the Lifetime Learning Credit.
The CARES Act grants are intended to provide emergency financial aid to students to cover expenses related to the disruption of campus operations due to the COVID-19 pandemic. These expenses may include food, housing, course materials, technology, and childcare.
The eligibility criteria for the CARES Act grants vary by institution but generally include requirements such as being enrolled in an eligible program, being a US citizen or eligible non-citizen, and having incurred expenses related to the disruption of campus operations due to the pandemic. Some institutions also require students to complete a FAFSA application to determine eligibility for financial aid.
The CARES Act also includes provisions for student loan forgiveness and the suspension of payment requirements for federal student loans for a few months in 2020. During this suspension period, no interest accrued on the loans.
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Frequently asked questions
No, the CARES Act grant is not a loan and does not need to be paid back.
The CARES (Coronavirus Aid, Relief, and Economic Security) Act is a federal grant that provides emergency funding to students to cover expenses related to the disruption of campus operations due to the COVID-19 pandemic.
To be eligible for the CARES Act grant, students must meet the basic eligibility criteria for federal student aid programs, be enrolled in an eligible financial aid program, and have incurred expenses related to the disruption of campus operations due to the COVID-19 pandemic.
To apply for the CARES Act grant, students must complete a Free Application for Federal Student Aid (FAFSA) and then submit an application for the grant. The application will specify the expenses incurred due to the disruption of campus operations, such as food, housing, course materials, technology, and childcare.
