The Vocabulary of Financial Aid: A Glossary
Accreditation-
The US Department of Education recognizes that the school meets basic academic standards. Schools must be accredited to be eligible to participate in federal student aid programs. Make sure the schools you are considering are accredited!
COA- Cost of Attendance
The total amount it will cost you PER YEAR to go to school. This number includes tuition and fees; room and board; and allowances for books, supplies, transportation, loan fees, and dependent care. It will include personal expenses, such as an allowance for the rental or purchase of a personal computer; costs related to a disability; and reasonable costs for eligible study-abroad programs.
DRN- Data Release Number
A 4 digit number given to you on your SAR (top right hand corner). It can be used to grant permission for your FAFSA data to be shared with other schools.
DEFAULT-
Failure to pay your loan according to the loan agreement or promissory note. There can be serious legal consequences of defaulting. Seek help before you choose to default!
DEFERMENT-
Postponing payment during which time interest does not accrue. You have to go through a process to request deferment. You can't just decide to stop paying!
DISBURSEMENT-
Payment of federal aid funds to the borrower (usually the student- that's you!) by the school. This usually happens twice a year.
EFC- Estimated Family Contribution
The number used to determine your federal financial aid is based on the information you provide on your FAFSA.
FAFSA- Free Application for Federal Student Aid
FEDERAL STUDENT AID-
This is financial aid provided by the federal government. You apply for the aid by completing the FAFSA. Grants, loans, and work study are all parts of Federal Student Aid. The money is to be used for college or career school costs at eligible schools.
FINANCIAL AID OFFER or PACKAGE-
The total amount of financial aid (federal and nonfederal) a student is offered by a college or career school. The school's financial aid staff combines various forms of aid into a “package” to help meet a student’s education costs.
FSA ID- Federal Student Aid Identification
INSTITUTIONAL AID-
Financial aid provided by the institution you are attending. This can come in the form of grants and/or scholarships for which you must submit applications.
INTEREST-
A loan expense paid to the borrower based on the interest rate and the remaining unpaid amount of the loan.
LOANS-
Money you borrow that must be repayed with interest.
PELL GRANT-
A federal grant for undergraduate students with financial need.
PERKINS LOAN-
A federal student loan, made by the recipient's school, for undergraduate and graduate students who demonstrate financial need.
SAR- Student Aid Report
You'll receive a SAR after you've completed your FAFSA application. If you provided an email address, the link to your report will come via email. Provided there were no errors on or questions about your FAFSA, this will also include your EFC.
SCHOLARSHIPS-
Money awarded to you for your educational expenses that does not have to be repaid. Don't forget to APPLY for a pile of scholarships!
WORK STUDY-
You'll complete part-time work on campus as part of your federal student aid. The money earned will be used to pay your college expenses.
Don't forget to talk to trusted people in your life about financial aid decisions!
