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
Award Letter
A letter that comes from our financial aid office and lists all of the financial aid awarded to you. It also provides details of your financial need, terms and conditions for that aid, and information about the cost of attendance. You are required to sign a copy of the letter, indicating whether you accept or decline each source of aid, and return it to the financial aid office.
Campus-based Aid
Financial aid programs that are administered by the university. The federal government provides the university with a fixed amount, which is awarded by the financial aid office. Keep in mind that there is no guarantee that every eligible student will receive financial aid through these programs.
College-Level Examination Program (CLEP)
A series of examinations that demonstrate your proficiency in a subject area, for which you can receive college credit.
Commuter Student
One who does not live on campus. Typically, "commuter" refers to a student living at home with his or her parents, but it can also mean any student who lives off campus.
Compounded Interest
Interest that is paid on both the principal balance of the loan and on any accrued (unpaid) interest. Capitalizing the interest on an unsubsidized Stafford loan is a form of compounding.
Consolidation Loan
Enables a borrower who has different types of loans to obtain a single loan with one interest rate and one repayment schedule. A consolidation loan pays off the existing loans. Then the borrower repays the consolidated loan.
Cost of Attendance
The total amount it should cost you to go to school, including tuition and fees, room and board, allowances for books and supplies, transportation, and personal and incidental expenses. This is also known as the cost of education or budget.
Credit Rating
An evaluation of your likelihood to default on a loan. Credit bureaus and credit reporting agencies provide this information to banks and businesses to help them decide whether to issue a loan or extend credit. Your credit rating may include your payment history, a list of current and past credit accounts and their balances, employment and personal information and a history of past credit problems. People who make all their payments on time are considered good credit risks. People who are frequently delinquent in making their payments are considered bad credit risks. Defaulting on a loan can hurt your credit rating.
Deferment (of loan)
Allows a borrower to postpone repaying the loan. Most federal loan programs allow students to defer their loans while they are in school at least half time – taking six credits. You can't get a deferment if your loan is in default.
Dependent Student
One who does not qualify as an independent student and whose parental income and asset information is used in calculating an Expected Family Contribution (see Independent Student).
Direct PLUS Loan
Long-term loans made available to parents of dependent students. Interest rates may not exceed 9%. The amount borrowed is limited to the cost of attendance minus estimated financial assistance.
Direct Subsidized and Direct Unsubsidized Loans
Long-term, low-interest loans administered by the Department of Education and institutions. The variable interest rate is not to exceed 8.25%.
Disbursement
The release of loan funds to the school to be delivered to the borrower. The payment will be made co-payable to the student and the school. Loan funds are first credited to the student's account to pay for tuition, fees, room and board and other school charges. Anything left over is paid to the student in cash or by check. Unless the loan amount is under $500, the disbursement will be made in at least two equal installments.
Expected Family Contribution (EFC)
The amount of money a student’s family is expected to be able to contribute to his or her education as determined by a formula approved by Congress. However, this amount is not necessarily what the family will contribute. The EFC includes the parent contribution and the student contribution, and depends on the student's dependency status, family size, number of family members in school, taxable and nontaxable income and assets.
Federal Pell Grant
A program for needy students who have not yet received a baccalaureate or first professional degree. It is administered by the U.S. Department of Education.
Federal Perkins Loan
A long-term, low-interest loan program for both undergraduate and graduate students at a current interest rate of 5%.
Federal PLUS Loan
Long-term loans made available to parents of dependent students. Interest rates may not exceed 9%. The annual amount borrowed is limited to the cost of attendance minus estimated financial assistance.
Federal Stafford Loan (subsidized and unsubsidized)
Long-term, low-interest loans administered by the Department of Education through private guarantee agencies. The loans come in two forms – subsidized and unsubsidized. Subsidized loans are based on need; unsubsidized loans aren't. The interest on the subsidized loan is paid by the federal government while you’re in school and during the six-month grace period. If you receive an unsubsidized loan, you are responsible for paying the interest as soon as you receive the loan even while you’re in school. You may avoid paying the interest while you’re in school by capitalizing the interest, but that will increase the loan amount.
Federal Supplemental Educational Opportunity Grant (FSEOG)
Grants to undergraduate students who have exceptional financial need and have not completed their first baccalaureate degree. Priority must be given to Federal Pell Grant recipients with the lowest EFCs.
Federal Work-Study Program
A part-time employment program that provides jobs for students who need the money to meet a portion of their educational expenses.
Financial Aid
A general term that describes any source of student assistance – besides the student or the student's family – that is awarded to help a student pay for college. These funds are generally awarded on the basis of financial need and include scholarships, grants, loans, and employment.
Financial Aid Award
An offer of financial or in-kind assistance to a student, which may be in the form of a repayable loan, a non-repayable grant, a scholarship and/or student employment.
Financial Aid Package
The complete collection of grants, scholarships, loans and work-study employment from all sources (federal, state, institutional and private) offered to a student to enable him or her to attend college.
Financial Need
The difference between the cost to attend college and the family's ability to pay.
Financial Need Equation
Cost of attendance minus Expected Family Contribution equals financial need.
Forbearance
A lender will allow you to temporarily postpone repaying the principal, but the interest charges continue to accrue. You must continue paying the interest charges during the forbearance period. Forbearances are granted at the lender's discretion, usually in cases of extreme financial hardship or other unusual circumstances when the borrower does not qualify for a deferment. You can't receive a forbearance if your loan is in default.
Free Application for Federal Student Aid (FAFSA)
The financial aid application document that a student and the student’s parents, if applicable, complete. The FAFSA collects household and financial information. The financial aid office needs the FAFSA to process a loan even for students who don’t qualify for need-based aid. Every student should apply for aid using the FAFSA, regardless of family income.
Grace Period
A short time period after graduation when you are not required to begin repaying your student loans. The grace period may also kick in if you leave school for a reason other than graduation or drop below half-time enrollment (six credit hours). Depending on the type of loan, you will have a grace period of six months to nine months.
Grant
Aid that does not have to be repaid. It is usually awarded on the basis of need, possibly combined with some skills or characteristics the student possesses.
Guarantee Agency or Guarantor
State agencies responsible for approving student loans and insuring them against default. Guarantee agencies also oversee the student loan process and enforce federal and state rules regarding student loans.
Guarantee Fee
A small percentage of the loan that is paid to the guarantee agency to insure the loan against default. The insurance fee is usually 1% of the loan amount. Also known as a Default Fee.
Independent Student: A student who:
(a) is 24 years old or who:
(b) is an orphan or a ward of the court;
(c) is a veteran;
(d) is married or is a graduate or professional student;
(e) has legal dependents other than a spouse; or
(f) presents documentation of other unusual circumstances demonstrating independence to the financial aid office
Loan
Aid that must be repaid, with interest.
Loan Interviews
Students with educational loans are required to meet with a financial aid counselor before they receive their first loan disbursement and again before they graduate or otherwise leave school. During these counseling sessions, called entrance and exit interviews, the counselor reviews the repayment terms of the loan and the repayment schedule with the student.
Merit-based Aid
Aid that takes into account your academic, artistic or athletic merit or some other criteria, and does not depend on your financial need. Merit-based awards use your grades, test scores, hobbies and special talents to determine your eligibility for scholarships.
Need
The difference between the cost of attendance and the expected family contribution. It’s the gap between the cost of attending the school and the student's resources.
Need-based Aid
Assistance awarded because a student's financial circumstances would not permit him or her to afford the cost of education.
Non Need-based Aid
Aid based on criteria other than need, such as academic, musical, or athletic ability. Also, refers to federal student aid programs where the expected family contribution is not part of the need equation.
Packaging
The process of assembling a financial aid package.
Parent Contribution
An estimate of the portion of your educational expenses that the federal government believes your parents can afford. It is based on their income, the number of parents earning income, assets, family size, the number of family members currently attending a university and other relevant factors. Students who qualify as independent are not expected to have a parent contribution.
Parent Loans for Undergraduate Students (PLUS)
Federal loans available to parents of dependent undergraduate students to help finance their education. Parents may borrow up to the full cost of education, less the amount of any other financial aid received. There is a minimal credit check required for the PLUS loan, so a good credit history is required. Check with your local bank to see if they participate in the PLUS loan program. If your application for a PLUS loan is turned down, your child may be eligible to borrow additional money under the Unsubsidized Stafford Loan program.
Pell Grant
A federal grant that provides funds of up to $2,340 based on your financial need.
Perkins Loan
Formerly the National Direct Student Loan Program, the Perkins Loan allows you to borrow up to $3,000 per year for up to 5 years for undergraduate school. The Perkins Loan has one of the lowest interest rates and is awarded by the financial aid office to students with exceptional financial need. To be eligible, you must have applied for a Pell Grant. The interest on the Perkins Loan is subsidized while you’re in school.
Principal (of a loan)
The amount of money borrowed through a loan and does not include interest or other charges, unless they are capitalized.
Private Loans
Education loan programs established by private lenders to supplement the student and parent education loan programs available from federal and state governments.
Promissory Note
A binding legal document you must sign before loan funds are disbursed by the lender. The promissory note states the terms and conditions of the loan, including repayment schedule, interest rate, deferment policy and cancellations. You should keep this document until the loan has been repaid.
Renewable Scholarships
A scholarship that is awarded for more than one year. Usually the student must maintain certain academic standards to be eligible for subsequent years of the award. Some renewable scholarships will require the student to reapply for the scholarship each year; others will just require a report on the student's progress to a degree.
Repayment Schedule
Discloses the monthly payment, interest rate, total repayment obligation, payment due dates and the term of the loan.
ROTC Scholarship Program
A competitive scholarship that pays for tuition, fees, books and a monthly living stipend and other benefits in exchange for participating in drills and classes during the academic year, military camp during the summer, and, upon graduation, full-time active duty in the military for at least four years.
Satisfactory Academic Progress (SAP)
You must make this in order to continue receiving federal aid. If you fail to maintain an academic standing consistent with the school's policy, you unlikely to meet the school's graduation requirements.
Scholarship
A form of financial assistance that does not require repayment or employment and is usually made to students who demonstrate or show potential for distinction, usually in academic performance.
Student Aid Report (SAR)
A report that summarizes the information included in the FAFSA and must be provided to your school's financial aid office. The SAR will also indicate the amount of Pell Grant eligibility, if any, and the Expected Family Contribution. You should receive a copy of your SAR four to six weeks after you file your FAFSA. Review your SAR and correct any errors. Keep a photocopy for your records.
Student Contribution
The amount of money the federal government expects the student to contribute to his or her education and is included as part of the EFC. The student contribution depends on the student's income and assets, but can vary from school to school. Usually you are expected to contribute about 20% of your savings and approximately one-half of summer earnings above $3,000.
Subsidy
The money the federal government uses to help underwrite student aid programs; primarily refers to government payments to lenders of the in-school interest on Federal Stafford Loans.
Subsidized Loan
With a subsidized loan, the government pays the interest while you are in school, during the six-month grace period and during any deferment periods. Subsidized loans are awarded based on financial need and may not be used to finance the family contribution.
Supplemental Education Opportunity Grant
Federal grant program for undergraduate students with exceptional need. SEOG grants are awarded by the school's financial aid office, and provide up to $4,000 per year. To qualify, a student must also be a recipient of a Pell Grant.
Taxable Income
Income earned from wages, salaries and tips, as well as interest income, dividend income, business or farm profits, and rental or property income.
Tuition Payment Plans
Payment for present costs of postsecondary education is extended into a future period of time.
Title IV Loans
Also known as the Federal Stafford Loans (Subsidized and Unsubsidized), Federal PLUS Loans and Federal Consolidation Loans.
Title IV School Code
When you fill out the FAFSA you need to supply the Title IV Code for each school to which you are applying. Pitt-Bradford’s code is 008815.
Unmet Need
The difference between your total cost attendance and your total available resources.
Unsecured Loan
A loan not backed by collateral, representing a greater risk to the lender. The lender may require a co-signer on the loan to reduce their risk. If you default on the loan, the co-signer will be held responsible for repayment. Most educational loans are unsecured loans. In the case of federal student loans, the federal government guarantees repayment of the loans. Other examples of unsecured loans include credit card charges and personal lines of credit.
Unsubsidized Loan
A loan for which the government does not pay the interest. You are responsible for the interest on an unsubsidized loan from the date the loan is disbursed, even while you are in school. You may avoid paying the interest while you are in school by capitalizing the interest, which increases the loan amount. Unsubsidized loans are not based on financial need.
Untaxed Income
All income received that is not reported to the Internal Revenue Service or is reported but excluded from taxation. Such income includes – but is not limited to – any untaxed portion of Social Security benefits, Earned Income Credit, welfare payments, untaxed capital gains, interest on tax-free bonds, dividend exclusion, and military and other subsistence and quarters allowances.
Verification
A review process in which the financial aid office determines the accuracy of the information provided on your financial aid application. During the verification process, you and your parents will need to submit documentation for the amounts listed (or not listed) on the financial aid application. Such documentation may include signed copies of the most recent federal and state income tax returns for you, your spouse (if any) and your parents, proof of citizenship, proof of registration with Selective Service, and copies of Social Security benefit statements. If you refuse to submit the required documentation, your financial aid package will be canceled and no aid awarded.
Veterans Educational Benefits
Assistance programs for eligible veterans and/or their dependents for education or training.