Financial Aid Glossary

Key Terms

Cost of Attendance Deferment Dependent Student Expected Family Contribution (EFC) FAFSA Grace Period Grant Loan

Origination Fee Promissory Note Satisfactory Academic Progress (SAP) Selective Service Registration Student Aid Report (SAR) Subsidized Interest Unsubsidized Interest

Defined Key Terms

Cost of Attendance: The total costs to attend college for the school year.

Deferment: A temporary postponement of loan payments that must be approved by the lender.

Dependent Student: A student under the age of 24 who does not qualify as an independent student by federal guidelines (see FAFSA questions 48-54) and whose parental income is used in calculating a student's expected family contribution (EFC).

Expected Family Contribution (EFC): The portion of your and your family's financial resources that should be available to pay for your educational costs.

FAFSA: Free Application for Federal Student Aid.

Grace Period: A six month period beginning after the borrower graduates, drops below half-time enrollment, or leaves school during which the borrower is not expected to make loan payments.

Grant: Financial aid that does not have to be repaid. Grants are usually awarded based on need but can also be awarded for academic achievement, special skill, talent, or heritage.

Loan: Loans are money that must be repaid over a period of time, usually after a student leaves school.

Origination Fee: Fee collected by the federal government to partially offset the cost of a loan program. This fee is deducted from the loan amount before the borrower receives the money.

Promissory Note: A written promise to repay a sum of money to the holder of the loan within a specified time period.

Satisfactory Academic Progress (SAP): The progress you must maintain toward a degree to receive financial aid.

Selective Service Registration: If required by law, a student must register with the Selective Service to receive federal student aid. This applies to males born on or after January 1, 1960 who are at least 18 years old, citizens and eligible non-citizens.

Student Aid Report (SAR): The report summarizing the information you reported on your FAFSA.

Subsidized Interest: Interest paid by the federal government while the borrower is in school or during grace and deferment periods.

Unsubsidized Interest: Interest paid by the borrower rather than the federal government.