Common Financial Aid Terminology
A letter from the Office of Financial Aid that that includes the breakdown of the financial aid package, according to the amount, source, and type of aid. It will include the terms, conditions and information about the cost of attendance.
Cost of Attendance/Student Budget
The total cost of education for the student. It includes tuition and fees, books and supplies, room and board, transportation, and miscellaneous expenses.
Failure to repay an education loan after it is 270 days past due.
When a student loan borrower is not required to make a payment on a student loan. The Subsidized Loan allows the deferment of principal and interest while the student is in school. (The federal government pays the interest on the loan.) The Unsubsidized Loan only provides deferment of principal while the student is in school.
Expected Family Contribution (EFC)
The EFC is found on the Student Aid Report when the FAFSA is completed, and is only used to determine a student’s eligibility for federal aid. It is the measurement of the student’s “financial strength” and not necessarily a statement of what a student is expected to pay out of pocket.
Financial assistance to help a student meet the costs involved in a college education. It comes in the form of grants, scholarships, and loans.
The difference between the cost of attendance and Estimated Family Contribution (EFC). The financial aid package, including the Federal Pell Grant and Federal Loan, is based on the amount of financial need.
Financial Aid Package
The amount of grants, scholarships, and loans a student receives from a college.
FAFSA (Free Application for Federal Student Aid)
This is the need analysis for determining a student’s eligibility for the Pell Grant and Stafford Loan. It may not be filed until after January 1st.
If the FAFSA is filed online, the Student Aid Report (SAR) will be emailed. If a paper FAFSA is filed, the SAR is mailed in 4-6 weeks.
The time period after a student withdraws or graduates from school and before loan repayment begins.
Financial aid that does not need to be repaid.
Financial aid that must be repaid with interest. Repayment of the Federal Loan does not begin until after the student graduates or enrollment falls below half-time status.
Master Promissory Note (MPN)
The legally binding document for students loan that lists all terms and conditions under which the monies were borrowed and will be repaid. Normally, it is completed once for a given college/university.
Outside Resource/Outside Scholarship
A financial aid source that was not provided by the college or federal government. Students are required to notify the Office of Financial Aid of an outside resource/scholarship. Receipt of an outside resource/scholarship may necessitate (by federal and college regulations) an adjustment to a student’s financial aid package.
Need-based federal grant, based on financial need as determined by the FAFSA.
Federal Loan – Subsidized
A federal loan that is based on financial need. The federal government pays the interest while the student is enrolled at least half-time.
Federal Loan – Unsubsidized
A federal loan not based on financial need. The federal government does not pay the interest while the student is enrolled. The student can either pay the interest while in school or allow it to accrue until graduation, withdrawal, or less than half-time status, and then start repaying the loan including all accrued interest.
SAR (Student Aid Report)
A summary of the information from the FAFSA.
Approximately one-third of students who file the FAFSA are selected by the federal processor for a process called “verification”. During the verification process, the student will be required to complete a Verification Worksheet and submit additional documental to help determine the accuracy on the FAFSA. Information obtained during the Verification Process may necessitate a change in the student’s financial aid award.