ACCRUING INTEREST:

This is the interest that begins accumulating once the loan is disbursed, increasing the amount needed to repay the loan.

 

ALTERNATIVE LOAN:

A credit based loan, not based on financial need, which begins to accrue interest immediately upon disbursement and

borrowed from a private lender. These loans are not federal loans and usually require a co-signer.

 

ANNUAL PERCENTAGE RATE (APR):

The annual rate it costs to borrow a loan when the loan fees required to secure the loan are added to the interest rate calculation.

 

AWARD YEAR (AY):

The time period for which your financial aid award offer is intended to cover. An award year does not exceed 12 months; the

reason you must complete a new FAFSA for each aid year.

 

CAMPUS BASED AID:

Financial aid terminology that refers to the three federal student aid programs that are awarded at the campus level: The

Federal Perkins Loan, the Federal Work Study program, and the Federal Supplemental Education Opportunity Grant (SEOG).

 

CAPITALIZED INTEREST:

The interest that has accrued since the loan disbursed and is added to the loan principal. Capitalization will occur on the

Unsubsidized Direct Loan, Parent PLUS, Grad PLUS and private alternative loans if the accruing interest is not paid as it accumulates.

  

COST OF ATTENDANCE:

The total cost to attend school for one academic year, including tuition, fees, room, meals, books, and other related expenses.

The sum of your financial aid, outside scholarships, and any private loans cannot exceed this amount.

 

DATA RELEASE NUMBER (DRN):

This number is printed on the Student Aid Report (SAR) or is available at www.fafsa.gov. You can provide your DRN to a s

chool so that school can add themselves to the list of schools you are authorizing to receive your FAFSA information.

 

DEFAULT:

Failure to make payment on a federal student loan for more than 270 days when a payment is required. A defaulted federal

student loan will cause you to be ineligible for additional federal student aid, lower your FICO score on your credit report,

add collection costs to your loan balance, and can result in the garnishment of your wages.

 

DEFERMENT:

A postponement of loan payments without accruing interest on a subsidized loan. Deferments are available for in-school

enrollment (half-time or greater), economic hardship, military active duty or post-military active duty student status.

Students must request a deferment with their lender.

 

DISCLOSURE STATEMENT:

A statement issued by the lender that outlines the cost of borrowing, taking into account the loan fees charged or deducted

and the amount of interest that will accrue during repayment.

  

EXPECTED FAMILY CONTRIBUTION (EFC):

The amount a family is expected to pay toward college costs. This amount is determined by completing the FAFSA, using

the Federal Methodology of need analysis.

 

FEDERAL DIRECT SUBSIDIZED LOAN:

A need-based loan on which the government pays the interest for you while you are in school at least half time and (in most cases)

during the six month grace period after leaving school.

 

FEDERAL DIRECT UNSUBSIDIZED LOAN:

A non need-based loan, where the borrower is always responsible for paying the interest on the loan.

 

FEDERAL METHODOLOGY:

The federal formula used in determining a family’s ability to pay for college, which is then used to calculate a student’s demonstrated

financial need.  Primarily considers the family's adjusted gross income, some forms of untaxed income, household size and number

in college (not counting parents or high school students taking college courses), family assets (not counting the value of their

principal residence or retirement accounts) and the age of the older parent.

 

FEDERAL STUDENT AID REPORT (SAR):

This is the FAFSA output document that summarizes the information submitted by the applicant on the FAFSA and the resulting EFC.

 

FREE APPLICATION FOR FEDERAL STUDENT AID (FAFSA):

The FAFSA is a standard federal application, which is used to determine your eligibility for most forms of financial aid.

The FAFSA should be completed early, every year at www.fafsa.gov.

                                                                                                                                                                                                                                                                                                                                                                            

 

FINANCIAL AID:

Any form of assistance, example: scholarships, federal and state grants, loans, and work study employment, etc.

 

FORBEARANCE:

The option to postpone, suspend, or reduce loan payments for up to 12 months, due to a financial hardship. The borrower is

required to request forbearance from the lender. Private loan lenders are not required to grant loan forbearance.

 

GIFT AID:

Grants, Scholarships, or awards that do not have to be paid back.

 

GRACE PERIOD:

The time period between a student’s graduation date, withdrawal date, or date of dropping below half time enrollment and

when his/her student loan payments begin. Grace periods are either six months (for FFELP and Direct Loans) or

nine months (for Perkins or Nursing Loans). Students should complete the exit interview process during their grace period.

 

GRANTS:

Gift aid that does not have to be repaid, generally awarded on the basis of financial need.

 

INDEPENDENT STUDENT:

For financial aid purposes, anyone over the age of 24 (as of December. 31, 2013 for the 2013-14 academic year;

December 31,  2014 for the 2014-15 year), is married at the time of completing the FAFSA, is providing more than 50% support

of their dependent child(ren), is on active military duty or a veteran of the U.S. Armed Forces, has been declared an emancipated

minor or homeless by an applicable governmental entity, or for whom both parents are deceased.

 

INTEREST RATE:

The annual percentage that a loan accrues interest on the outstanding loan principal borrowed which must be repaid.

 

LOAN:

Money that is borrowed and has to be repaid.

 

MERIT AID:

Scholarships that are typically awarded for prior outstanding academic achievements and not dependent upon financial need.

 

NATIONAL STUDENT LOAN DATA SYSTEM (NSLDS):

A federal on-line warehouse where you can view your borrowing history for the Federal Perkins, Direct, Grad PLUS, and Stafford Loans.

 

NEED:

The difference between the cost of attending school (COA) and the Expected Family Contribution (EFC).

 

NEED BASED AID:

Aid awarded on the basis of the financial need of the student, based on the information submitted on the FAFSA.

 

OFFER:

Financial aid package of awards.

 

ORIGINATION FEE:

The fees charged for borrowing a loan, often deducted from the loan prior to its disbursement. There is no origination fee for

the Federal Perkins or Federal Nursing Loans. Origination fees on the Federal Direct Loan programs will differ, based on when

the student receives the first disbursement of their Direct Loan or the PLUS Loan and whether the student is an undergraduate or graduate

student.

 

PERSONAL IDENTIFICATION NUMBER (PIN):

Your electronic signature you create to sign your FAFSA and the promissory note for federal student loans, as well as accessing

your student loan record on the NSLDS.ed.gov web site. The PIN is acquired at        

 

 

PROFILE:

A College Board, fee-based program that allows a school to calculate an expected family contribution that considers information

not required on the Free Application for Federal Student Aid.  Profile results cannot be used to determine eligibility for federal student aid,

only institutional scholarships and grants. 

 

PROMISSORY NOTE:

A promissory note is a binding legal document you sign when you borrow a student loan. It lists the conditions under which you are

borrowing and 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.

 

SELF-HELP:

Loan and/or employment (work study).

 

STAFFORD LOANS:

The primary federal student loan program under the Federal Family Education Loan program (FFELP) through commercial lenders,

which was discontinued after the 2009-10 academic year and replaced with the William D. Ford Direct Loan program. 

The Direct Loan is still often referred to as the Federal Direct Stafford Loan.

 

STUDENT AID REPORT (SAR): 

The document generated by the FAFSA after an application has been successfully transmitted to the US Department of Education.

It is a summary of the information provided by the applicant, as well as the Expected Family Contribution (EFC), the Data Release Number (DRN),

and whether the applicant was selected for verification. The SAR is emailed to the applicant if an email address is provided on the FAFSA.

 

SUBSIDIZED LOANS:

Need-based loans (Perkins, Nursing, and Direct Subsidized) whose interest does not begin to accrue until the student enters repayment,

six to nine months after graduation, withdrawal, or dropping below half time enrollment.  (Note:  As part of sequestration,  interest on

loans whose first disbursement occurred between July 1, 2012 and July 1, 2014 will begin to accrue interest during the grace period)

 

TILA (TRUTH-IN-LENDING ACT of 1968):

Federal act that was designed to promote the informed use of consumer credit. Requires lenders to provide disclosure statements

that outline the true cost of borrowing a loan when loan fees and interest accrual is included in the total cost.

 

UNSUBSIDIZED LOANS:

Loans that are not need-based, whose interest begins to accrue as soon as the loan is disbursed. These include the Unsubsidized Direct Loan,

the Federal Parent PLUS and Grad PLUS loans, as well as all private/alternative loans.

 

VERIFICATION:

Aprocess to verify the accuracy of the data submitted on the FAFSA. Students

 

VERIFICATION:

A process to verify the accuracy of the data submitted on the FAFSA. Students are notified that they have been selected for verification

on their SAR. To complete the verification process, you must submit a signed Verification worksheet and verify your prior year's income tax

information through the Data Retrieval Tool on the FAFSA or by submitting a Federal Tax return transcript.

 

WASHINGTON STUDENT ACHIEVEMENT COUNCIL:

The state agency responsible for oversight of the Washington state student aid programs. 

 

WORK STUDY:

Work-study provides part-time employment for students (with demonstrated financial need) an opportunity to earn money to help

meet educational costs.

 

W-2 Form:

An Internal Revenue Service form that you should receive from your employer in January, outlining your calendar year earnings

from that employer, as well as any withholdings taken out of your earnings during the year.

 

W-4 Form:

An Internal Revenue Service form that you must complete with your employer so federal withholding taxes, if required, can be

calculated for deduction from your paycheck per IRS regulations.