Glossary

A, B, C, D, E, F, G, H, I, J, K, L, M, N, O, P, Q, R, S, T, U, V, W, X, Y, Z,

Ability-to-Benefit
One of the criteria used to establish student eligibility in order to receive Title IV program assistance is that a student must have earned a high school diploma or its equivalent. Students who are not high school graduates (or who have not earned a General Education Development [GED] Certificate*) can demonstrate that they have the “ability to benefit” from the education or training being offered by passing an approved ability-to-benefit (ATB) test. see Federal Financial Aid: What Types of Aid Are Available?

Academic Year
A period of time schools use to measure a quantity of study. For example, a school’s academic year* may consist of a fall and spring semester during which a full-time undergraduate student must complete 24 semester hours. Academic years vary from school to school and even from educational program to educational program at the same school. see Federal Financial Aid: Who Is Eligible?

Accreditation
Accreditation is a process through which colleges, universities, and career training schools can publicly document that their education programs meet regional or national education standards for academic quality. Accreditation confirms that the school has been evaluated by a recognized U.S. accrediting agency and assessed as meeting the same requirements for authenticity and integrity as other schools receiving the same accreditation.

Accrue
To accrue means to accumulate. An Accrual date is the date on which interest on a loan begins to accrue. see Federal Loan Programs

Adjusted Available Income
According to the Federal Government's method's, the Adjusted Available Income is the remaining income after allowances such as taxes and basic living allowances have been subtracted. see Making Sense of Your Financial Aid Award Letter

Amortization
Amortization is a gradual process of loan repayment where the loan is paid over an extended period of time through a schedule of payments of principal and interest. see Federal Loan Programs

Apprenticeship
Apprenticeship is a combination of on-the-job training and related instruction in which workers learn the practical and theoretical aspects of a highly skilled occupation. Apprenticeship programs can be sponsored by individual employers, joint employer and labor groups, and/or employer associations.

Associate Degree
Associate degrees are a type of college degree which is usually awarded after the completion of at least 60 semester credit hours, or approximately 20 classes. Courses include career training, general education and elective classes. Associate degrees generally prepare students for a professional career; however, they also prepare students for further college education, like a bachelor degree. See more info on Associate Degrees

Award Letter
An award letter from a school states the type and amount of financial aid the school is willing to provide if you accept admission and register to take classes at that school. see Federal Financial Aid: What Types of Aid Are Available?

Balloon Payment
A substantial payment used to repay the outstanding balance of a loan free of penalty. Balloon payments are not available on all loans. Fortunately, simple interest loans, like most educational loans, normally do allow balloon payments. see Federal Loan Programs

Bachelor Degree
A bachelor degree, sometimes called a baccalaureate degree, is a college degree awarded to students who complete a full 4-year undergraduate course of study. A bachelor degree offers many benefits and opportunities like increased earning potential, greater career opportunities, and opening the door for further education. Increasingly, many adults with a high school diploma or GED are going back to school to earn their bachelor degree. Read more info on Bachelor Degrees

Bursar
The Bursar is the senior financial administrator in a college or school. The Bursar's office is the administrative body responsible for billing student tuition accounts. They are not involved in the financial aid process; however, they do sometimes receive money from scholarships which is then disbursed to students. see Making Sense of Your Financial Aid Award Letter

Capitalized
With certain loans, such as subsidized FFEL Loans, the U.S. Department of Education pays the interest that accrues on these loans while the student is enrolled at least halftime* and during periods of deferment. However, with subsidized loans in forbearance, unsubsidized loans or PLUS Loans, the student or the student’s parents and graduate or professional degree students are responsible for paying interest as it accrues on these loans. When the interest is not paid, it is capitalized or added to the principal balance, which increases the outstanding principal amount due on this loan. Interest that is capitalize and, therefore, has been added to the original amount of the loan subsequently accrues interest, adding an additional expense to the loan. see Federal Loan Programs

Consolidation Loan
A Consolidation Loan combines several student loans into a single loan. This way, you only have to pay one lender. Consolidation Loans are used to pay off balances on other loans.

Cost of Attendance (COA)
The total amount it will cost you to go to school—usually expressed as a yearly figure. It’s determined using rules established by law. The COA includes tuition and fees; on campus room and board (or a housing and food allowance for off-campus students); and allowances for books, supplies, transportation, loan fees, and, if applicable, dependent care. It also includes miscellaneous and personal expenses, including an allowance for the rental or purchase of a personal computer. Costs related to a disability are also covered. The COA includes reasonable costs for eligible study-abroad programs as well. For students attending less than half-time,* the COA includes tuition and fees and an allowance for books, supplies, transportation and dependent care expenses; but can also include room and board for up to three semesters or the equivalent at the institution, but no more than two of those semesters or the equivalent may be consecutive. Talk to the financial aid administrator at the school you’re planning to attend if you have any unusual expenses that might affect your cost of attendance. see Making Sense of Your Financial Aid Award Letter

Default
Failure to repay a loan according to the terms agreed to when you signed a promissory note.* For the FFEL and Direct Loan programs, default* is more specific—it occurs if you fail to make a payment for 270 days if you repay monthly (or 330 days if your payments are due less frequently). The consequences of default* are severe. Your school, the lender or agency that holds your loan, the state and the federal government may all take action to recover the money, including notifying national credit bureaus of your default.* This may affect your credit rating for as long as seven years. For example, you might find it difficult to borrow money from a bank to buy a car or a house. In addition, the Internal Revenue Service can withhold your U.S. individual income tax refund and apply it to the amount you owe, or the agency holding your loan might ask your employer to deduct payments from your paycheck. Also, you may be liable for loan collection expenses. If you return to school, you’re not entitled to receive additional federal student financial aid. Legal action also might be taken against you. In many cases, default* can be avoided by submitting a request for a deferment, forbearance, discharge or cancellation and by providing the required documentation. see Federal Loan Programs

Disburse
To disburse means to pay out funds, to distribute money. see Making Sense of Your Financial Aid Award Letter

Eligible Non-citizen
You must be one of the following to receive federal student aid:

U.S. citizen
U.S. national (includes natives of American Samoa or Swain’s Island)
U.S. permanent resident who has an I-151, I-551, or I-551C (Permanent Resident Card)

“Refugee”
“Asylum Granted”
“Cuban-Haitian Entrant, Status Pending”
“Conditional Entrant” (valid only if issued before April 1, 1980)
Victims of human trafficking, T-visa (T-2, T-3, or T-4, etc.) holder
“Parolee” (You must be paroled into the United States for at least one year and you must be able to provide evidence from the USCIS that you are in the United States for other than a temporary purpose and that you intend to become a U.S. citizen or permanent resident.) If you have only a Notice of Approval to Apply for Permanent Residence (I-171 or I-464), you’re not eligible for federal student financial aid. If you’re in the United States on certain visas, including an F1 or F2 student visa, or a J1 or J2 exchange visitor visa, you’re not eligible for federal student financial aid.

Also, people with G series visas (pertaining to international organizations) are not eligible for federal student financial aid. For more information about other types of visas that are not acceptable, check with your school’s financial aid office. Citizens and eligible non-citizens may receive loans from the FFEL Program at participating foreign schools. Citizens of the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau are eligible only for Federal Pell Grants, Federal Supplemental Educational Opportunity Grants or Federal Work-Study. These applicants should check with their schools’ financial aid office for more information. see Federal Financial Aid: Who Is Eligible?

Eligible Program
A program of organized instruction or study that leads to an academic, professional or vocational degree or certificate, or other recognized educational credential. To receive federal student financial aid, you must be enrolled in an eligible program*, with two exceptions: • If a school has told you that you must take certain course work to qualify for admission into one of its eligible programs, you can get a Stafford Loan for up to 12 consecutive months while you’re completing that preparatory course work. You must be enrolled at least half-time*, and you must meet the usual federal student financial aid eligibility requirements. • If you’re enrolled at least half-time* in a program to obtain a professional credential or certification required by a state for employment as an elementary or secondary school teacher, you can get a Federal Perkins Loan, Federal Work-Study, a Stafford Loan, or your parents can get a PLUS Loan, while you’re enrolled in that program. see The Key To Obtaining Federal Financial Aid

Expected Family Contribution
Your Expected Family Contribution (EFC) is the number that’s used to determine your eligibility for federal student financial aid. This number results from the financial information you provided in your FAFSA application. Your EFC is reported to you on your Student Aid Report* (SAR). see Making Sense of Your Financial Aid Award Letter

FAFSA
The Free Application for Federal Student Aid is the application form students who wish to apply to any federal student aid program must fill out. The FAFSA must be filled out annually. see The Key To Obtaining Federal Financial Aid

Fellowship
A type of financial aid typically granted to graduate students to help finance their studies. Sometimes these include a tuition waiver or a payment to the university in lieu of tuition. Most include a stipend to cover basic living expenses (think just above the poverty line). Fellowships are like scholarships in the sense that they are a type of gift aid that does not have to be repaid. see Scholarships for Adult Learning

Financial Aid Package
The total amount of financial aid (federal and nonfederal) a student is offered by the school. The financial aid administrator at a postsecondary institution combines various forms of aid into a “package” to help meet a student’s education costs. Using available resources to give each student the best possible package of aid is one of the aid administrator’s major responsibilities. Because funds are often limited, an aid package might fall short of the amount a student needs to cover the full cost of attendance.* Also, the amount of federal student aid in a package is affected by other sources of aid received (scholarships, state aid, etc.). see Making Sense of Your Financial Aid Award Letter

Forbearance
A postponement of loan payments granted by a loaner or a creditor for a temporary period of time is called a forbearance. Usually lenders will do this to give the borrower a little extra time to make up for late payments. see Federal Loan Programs

Full-Time Student
For Federal Studnet Aid purposes, to be considered full-time a student must be enrolled in:

12 semester or quarter hours per term in a term-based program using credit hours
24 semester hours or 36 quarter hours per academic year (or the prorated equivalent for a program of less than one academic year) in a nonterm program using credit hours
24 clock hours of instruction per week in a clock-hour program

Special rules apply to students taking a combination of courses using different types of hours, as well as to students taking correspondence courses or a co-op program. The regulations do not specify a minimum standard for graduate students.

General Education Development (GED) Certificate
This is a certificate students receive if they’ve passed a specific, approved high school equivalency test. Students who have a GED may still qualify for federal student aid. A school that admits students without a high school diploma must make available a GED program in the vicinity of the school and must inform students about the program. see Federal Financial Aid: Who Is Eligible?

Grace Period
The short period of time after graduation during which the borrower is exempt from having to begin repaying their student loans is called the grace period. The grace period may also come into effect if the student leaves school for some other reason, or if the student drops below half-time enrollment. Stafford loans generally have a 6-month grace period, while Perkins loans have a 9-month grace period. PLUS loans do not have a grace period. see Federal Loan Programs

Grant
A transfer of funds from a Government entity or other organization to another organization or individual. In education, a scholarship can be one type of grant. see Federal Grant Programs

Guaranty Agency
The guaranty agency is an organization that administers the Federal Family Education Loan (FFEL) Program in your state. This agency is the best source of information on FFEL Loans. For the name, address and telephone number of the agency serving your state, you can contact the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243). see Federal Loan Programs

Half-time
At schools measuring progress in credit hours and semesters, trimesters, or quarters, “half-time” is at least six semester hours or quarter hours per term for an undergraduate program. At schools measuring progress by credit hours but not using semesters, trimesters or quarters, “half-time” is at least 12 semester hours or 18 quarter hours per year. At schools measuring progress by clock hours, “half-time” is at least 12 hours per week. Note that schools may choose to set higher minimums than these. You must be attending school at least half-time to be eligible for a Stafford Loan. Half-time enrollment is not a requirement to receive aid from the Federal Pell Grant, Federal Supplemental Educational Opportunity Grant, Federal Work-Study, and Federal Perkins Loan programs. see Federal Financial Aid: Who Is Eligible?

Holder
The holder is the financial institution, agency or lender that holds legal title to a loan. As such, it may be the bank that issued the loan, a secondary market that bought the loan from the bank or, if the borrower defaulted on the loan, a guarantee agency. see Federal Loan Programs

Income Contingent Repayment
A loan repayment schedule where the size of the monthly payments depends on the income earned by the borrower is called an income contingent repayment schedule. If the borrower's income increases, the loan payments increase as well. This payment plan is not available for PLUS loans. see Federal Loan Programs

Independent
If a student is at least 24 years old as of January 1 of the academic year, married, a graduate or professional student, a veteran of the US Armed Forces, an orphan or ward of the court, or has a legal dependent other than a spouse, then the student is classified as an independent. see Federal Financial Aid: Who Is Eligible?

Internship
An internship is a part-time position held during the school year or summer months where the student receives practical training in a field usually related to their course of study. At times, internships may serve as a preamble or precursor to professional employment. Some internships place the student under close supervision by a mentor in an apprentice-like position. A stipend is provided by some internship programs, although this is not always the case. see Federal Financial Aid: What Types of Aid Are Available?

Java
Java is a programming language. Other examples of programming languages are C, BASIC, and Scheme.

Journalism
The discipline of preparing, writing and reporting news through media outlets like magazines, newspapers, books, radio, television, and more.

Knowledge Management
A range of practices that organizations use to identify, create, represent and distribute knowledge and information. Knowledge management resources are usually included as part of a company's Information Technology or Human Resources departments.

Legacy Preference or Legacy Admission
Students that have a family member who is an alumnus of the institution they are applying to are sometimes given Legacy Preference or Admission. Students who are enrolled in a college or university that gave them Legacy Admission are called Legacy Students.

Leveraging
Leveraging is the name given to the practice of offering financial aid to talented and promising students, with the intention of having the student enroll at a particular school, regardless of the student's need. The idea behind the practice is that if a school offers more financial aid, the student is more likely to enroll. see Making Sense of Your Financial Aid Award Letter

Loan
A form of financial aid that must be repaid with interest is called a loan. There are subsidized loans and unsubsidized loans. see Federal Loan Programs

Loan Consolidation
A consolidation loan is a type of loan where outstanding student loans are purchased and closed by a loan consolidation company or the Dept. of Education. Often this is done to secure a fixed interest rate, based on the then-current interest rate or rates. see Federal Loan Programs

Matriculate
To matriculate is to enroll. A student who is enrolled in college is matriculated in college. see Federal Financial Aid: What Types of Aid Are Available?

Maturity Date
The date when a loan comes due and must thus be repaid in full. see Federal Loan Programs

Merit-Based
In the context of financial aid, merit-based describes financial aid that depends on your performance or merit in a specific field, usually academic, artistic or athletic, regardless of financial need. see Scholarships and Grants from Private Organizations

Need-Based
Financial aid that depends on a student's financial situation is called need-based. Usually the student must provide specific information on their family's financial status in order to apply for need-based financial aid. see Student Financial Aid: Who Provides It?

Need-Blind
Schools that use a need-blind admissions process make their decision of whether to admit a student or not without considering the student's financial need. Although most schools are need-blind, some schools will use financial information in order to decide if a marginal student should be put on the wait list. see The Key To Obtaining Federal Financial Aid

Need-Sensitive
Schools that use a need-sensitive admissions process take the applicant's financial situation under account when deciding whether to admit him or her. Sometimes schools use the need-sensitive process to decide whether to admit a borderline student or to pull a student off the wait list. see Federal Financial Aid: What Types of Aid Are Available?

National Student Loan Data System (NSLDS)
NSLDS is our database for federal student financial aid where you can find out about the aid you’ve received. If you’ve only just applied for aid, you won’t find any information on NSLDS yet. NSLDS receives data from schools, guaranty agencies* and U.S. Department of Education programs. The NSLDS Web site is generally available 24 hours a day, seven days a week. By using your PIN, you can get information on federal loan and Pell Grant amounts, outstanding balances, the status of your loans and disbursements made. You can access NSLDS at www.nslds.ed.gov. see Federal Loan Programs

Origination Fee
Fees that are paid to the bank to compensate them for the cost of administering a loan are called origination fees. They are charged at disbursement, usually running to 3% of the disbursed amount. Part of this fee goes to the federal government to offset the administrative costs of the loan. see Federal Loan Programs

Over-awards
Awards in excess of a student's financial need are called over-awards. A student receiving federal support can not receive awards totaling $400 over their financial need. see Federal Grant Programs

Principal
The amount of money borrowed or that remains to be paid on a loan. Interest is charged as a percentage of this number. see Federal Loan Programs

Parent Contribution
The federal government prepares an estimate of how much they believe your parents can afford to contribute towards your educational expenses called the Parent Contribution. They base the estimate on the number of parents earning income, their total income, their assets, family size, number of family members currently in school, as well as other factors. Independent students are not expected to have a family contribution. see Making Sense of Your Financial Aid Award Letter

Pell Grant
The Pell Grant is a form of federal need-based financial aid, where eligible students receive a specified amount each year. A standard formula is used by the U.S. Dept. of Education to calculate the award amount based on the information submitted by the student. The result is an Expected Family Contribution number which determines whether the student is eligible for a Pell Grant. Since 2002, the maximum Pell grant award has been $4,050 per academic year. see Federal Financial Aid: Who Is Eligible?

Perkins Loan
The Pell Grant is a form of federal need-based financial aid, where eligible students receive a specified amount each year. Since 2002, the maximum Pell grant award has been $4,050 per academic year. The amount you receive depends on when you apply, your financial need, and the funding level at the school.see Federal Financial Aid: Who Is Eligible?

PIN
PIN is the acronym for Personal Identification Number. The PIN is a number provided to you by the Department of Education serving as your electronic signature and providing access to your personal records. With the PIN you can fill out the FAFSA online see FAFSA Application Process Overview

PLUS Loan
Parents can borrow a PLUS Loan to help pay your education expenses if you are a dependent undergraduate student enrolled at least half time in an eligible program at an eligible school. PLUS Loans are available through the Federal Family Education Loan (FFEL) Program and the William D. Ford Federal Direct Loan (Direct Loan) Program. see Federal Loan Programs

Promissory Note
A promissory note is a binding legal document you sign when you get a student loan. It lists the conditions under which you’re borrowing and the terms under which you agree to pay back the loan. It will include information on how interest is calculated and what deferment and cancellation provisions are available to the borrower. It’s very important to read and save this document because you’ll need to refer to it later when you begin repaying your loan or at other times when you need information about provisions of the loan, such as deferments or forbearances. see Federal Loan Programs

Private Loans
Loans issued through programs established by private lending institutions, designed to supplement the loans available form the Federal Government. see Student Loan Programs: New Rules

Qualify
A person that fits the application criteria for a program or activity qualifies for participation in such a program or activity. see Federal Financial Aid: Who Is Eligible?

Regular Student
A regular student is one who is enrolled or accepted for enrollment at an institution for the purpose of obtaining a degree, certificate or other recognized education credential offered by that institution. Generally, to receive federal student financial aid from the programs discussed in this guide, you must be a regular student. There are exceptions to this requirement for some programs. see Federal Financial Aid: Who Is Eligible?

Renewable Scholarships
Scholarships that are awarded for more than one year are sometimes known as renewable scholarships. Most of these require students to maintain a certain level of performance in order to continue receiving the scholarship(s). Some require students to re-apply every year, others only ask for a progress report. see Federal Grant Programs

Repayment Schedule
This discloses loan details like payment due dates, monthly payment size, total repayment obligation, interest rate, and the term of the loan. see Student Loan Programs: New Rules

Repayment Term
The term is the period of time during which a borrower is expected to make payments on their loans. see Federal Loan Programs

Satisfactory Academic Progress
To be eligible to receive federal student financial aid, you must meet and maintain your school’s standards of satisfactory academic progress toward a degree or certificate offered by that institution. Check with your school to find out its standards. see Federal Financial Aid: Who Is Eligible?

Scholarship
A grant of financial assistance awarded to a student, with the purpose of covering educational expenses.see Federal Grant Programs

Selective Service Registration
Registering with the Selective Service System (draft system) is a federal financial aid requirement. In order to receive federal student financial aid, if you are a male born on or after Jan. 1, 1960, are at least 18 years old, and are not currently on active duty in the U.S. Armed Forces, you must register, or arrange to register, with the Selective Service System. (Citizens of the Federated States of Micronesia, the Republic of the Marshall Islands or the Republic of Palau are exempt from registering.) see Federal Financial Aid: Who Is Eligible?

Servicer
An organization that performs administrative tasks necessary to maintain a loan portfolio is called a loan servicing agency. These tasks can include collecting payments, monitoring loans while borrowers are in school, disbursing loan funds, responding to borrower questions, processing deferments and forbearances, and anything else necessary for the loans to be administered in accordance with federal laws and guarantee agency requirements. see Federal Loan Programs

Simple Interest
This is paid only on the principal balance of a loan, not on any accrued interest. Mist student loan programs offer this type of interest. see Federal Loan Programs

Stafford Loans
Loans made available to students through the Direct Loan Program and the Federal Family Education Loan Program (FFEL). see Federal Loan Programs

Student Aid Report
After you apply for federal student financial aid, you’ll get your FAFSA results in an e-mail report within a few days after your FAFSA has been processed or by mail in a few weeks. This report is called a Student Aid Report or SAR. Your SAR details all the information you provided on your FAFSA. If there are no corrections or additional information required, the SAR will contain your Expected Family Contribution* (EFC), which is an important number in determining how much aid you can qualify for. Whether you applied online or by paper, we will automatically send your data electronically to the schools you listed on your FAFSA. see Making Sense of Your Financial Aid Award Letter

Subsidized Loan
A subsidized loan is awarded on the basis of financial need. If you're eligible for a subsidized loan, the government will pay (subsidize) the interest on your loan while you're in school, for the first six months after you leave school, and if you qualify to have your payments deferred. Depending on your financial need, you may borrow subsidized money for an amount up to the annual loan borrowing limit for your level of study. see Federal Loan Programs

Term
The term is the number of years (or months) during which the loan must be repaid. see Federal Loan Programs

Title IV Loans
Collectively referred to as the Federal Family Education Loan Program, these were created by Title IV of the Higher Education Act of 1965. They include Federal Stafford, PLUS and Consolidation loans. see Federal Loan Programs

Unsecured Loan
A type of loan not backed by collateral is called an unsecured loan. This type of loan usually represents a greater risk to the lender. Unsecured loans usually require a co-signer to vouch for the borrower. If the borrower defaults on the loan, the co-signer will be held responsible for repayment. Most educational loans are unsecured loans, and on most federal loans the federal government guarantees repayment. see Federal Loan Programs

Unsubsidized Loan
A type of loan where the borrower pays the interest is called an unsubsidized loan. In a subsidized loan, however, the federal government usually pays the interest. In an unsubsidized loan, the borrower is responsible for the interest from the date the loan is disbursed, whether the student is still in school or not. see Student Loan Programs: New Rules

Variable Interest
Loans with a periodically changing interest rate are called variable interest loans. see Student Loan Programs: New Rules

Verification
Verification is the review process in which the Financial Aid Office cross-checks the information on a student's financial aid application. What happens is that the student and parent(s) are required to submit documentation backing up the information provided or omitted on the financial aid application. see Federal Financial Aid: Who Is Eligible?

Ward of the court
If you are a ward of the court it means that you have no parents or another person who is financially responsible for you and the court has assumed custody of you. If you have a legal guardian or foster parents you may still be a ward of the court. see Federal Financial Aid: Who Is Eligible?

Work Study
The Federal Work-Study program provides jobs for undergraduates and graduate students who demonstrate financial need, allowing them to earn money to help pay education expenses. Jobs are either on campus or off campus. Off-campus jobs must be related to community service. see Federal Financial Aid: The Work-Study Program

X-Ray Technician
Their role is to support doctors by managing the X-Ray imaging process. Their responsibilities include preparing patients for X-Rays, performing the X-Ray, and acting as a crucial information link between patients and doctors.

Youth Counselor
These are counselors that focus on providing guidance and support to children and teenagers. A youth counselor will usually work in a school, church, community organization or other private or government funded institution.