Glossary
Academic Year
An academic year is one complete school year at the same school, or two complete, half years at different schools. For schools that have a year-round program of instruction, nine months is considered an academic year.
Acceleration
Acceleration is the demand for immediate repayment of the entire outstanding balance of a loan.
Aid for Military Family
Both the federal government and nonprofit organizations offer money for college to veterans, future military personnel, active duty personnel, or those related to veterans or active duty personnel.
Alternative Documentation of Income
Alternative documentation of income (ADOI) is proof of all current income to be provided when applying for an income-driven repayment (IDR) plan and not providing a federal tax return or tax transcript.
Annual Taxable Income
Your annual taxable income is the amount of income used to determine how much tax you owe in a given year. This can include wages, salaries, bonuses, tips, investment income, and unearned income.
Are you someone’s dependent?
Choose ‘no’ if no one can claim you or your spouse as a dependent. Choose ‘yes’ if someone can claim you as a dependent. Choose “Both you and your spouse” if you both are dependents. (You are a dependent if someone supports you and can claim a dependency exemption for you.)
Award Year
School year for which financial aid is used to fund a student’s education. Generally, this is the 12-month period that begins on July 1 of one year and ends on June 30 of the following year.
Capitalization
Capitalization is the addition of unpaid accrued interest to the principal balance of a loan. Over time, this can increase your monthly payment.
Collection Agency
An entity that recovers unpaid debt from borrowers who have defaulted on their loans.
Collection Costs
Expenses charged on defaulted federal student loans that are added to the outstanding principal balance of the loan.
Cookie
Cookies are bits of data that a website transfers to a computer’s hard drive. The most common use of cookies is for a website to determine your personal preferences. Some cookies disappear once you close the browser while some remain.
Credit
Credit refers to the amount of money you borrow and your ability to borrow to purchase goods and services. Credit is extended to you from a credit grantor with which you make an agreement to pay back the amount spent, plus applicable interest and fees, within an agreed-upon time.
Debt Collection
Debt collection is the course of pursuing payments of loan debts due by borrowers.
Debt Consolidation
Debt consolidation is a method of debt refinancing that involves taking out one loan to pay off others.
Default
A loan goes into default when you fail to repay the loan as outlined in your promissory note. Most federal student loan default occurs when a payment isn’t made in more than 270 days. It can result in legal
Debt Consolidation
Debt consolidation is a method of debt refinancing that involves taking out one loan to pay off others.
Deferment
A deferment is a temporary postponement of payment on a loan that is allowed under consequences and a loss of eligibility for additional federal student aid. Certain conditions and during which interest doesn’t accrue on subsidized loans. More info: https://studentaid.gov/manage-loans/lower-payments/get-temporary-relief/deferment
Debt Consolidation
Debt consolidation is a method of debt refinancing that involves taking out one loan to pay off others.
Deferment Dependents qualifying for child tax credit
You may be entitled to a child tax credit for each qualifying child who was under age 17 at the end of the year if you claimed an exemption for that child. The credit is, however, phased out at higher incomes.
Direct PLUS Loan
Direct PLUS Loans are federal loans that graduate or professional students and parents of dependent undergraduate students use to help pay for education expenses.
Direct Subsidized Loan
A Direct Subsidized Loan is a federal student loan where a borrower isn’t generally responsible for paying interest while in an in-school, grace, or deferment period. To apply, start by submitting a FAFSA® form: https://studentaid.gov/h/apply-for-aid/fafsa.
Discretionary Income
Discretionary income is a factor used in determining a borrower’s payment amount for certain loan repayment plans and/or loan rehabilitation. It’s the difference between annual income and a percentage of the poverty guideline for the borrower’s family size and state of residence.
Early Action
Early action is a college admission policy that allows applicants to apply and receive notice of their admission early. Applicants accepted under early action are not under a binding agreement to attend that school and may submit applications to other schools.
Early Decision
Early decision is a college admission policy that allows applicants who commit to attend a school to apply and receive notice of their admission early. If an applicant is accepted, he or she agrees to attend that school and must withdraw all other applications.
Educational Service Agency
An educational service agency is a regional public multiservice agency that is authorized by state law to develop, manage, and provide services or programs to local education agencies, such as public-school districts.
Eligible Program
An eligible program is a program of organized instruction or study of a certain length that leads to an academic, professional, or vocational degree or certificate, or other recognized education credential.
Emancipated Minor
An emancipated minor is someone who has been legally deemed an adult by a court in his or her state of residence. If you are an emancipated minor, you are considered an independent student and will not provide information about your parents on the FAFSA® form.
Endorser
An endorser is someone who agrees to repay the Direct PLUS Loan if the borrower becomes delinquent in making payments or defaults on the loan. The endorser may not be the student on whose behalf a parent obtains a Direct PLUS Loan. Apply: https://studentaid.gov/endorser-addendum
Endorser Code
An Endorser Code is used to complete a Direct PLUS Loan addendum to the Master Promissory Note. If encountering issues, go here: https://studentaid.gov/help-center/answers/article/endorser-code-issue-troubleshooting.
Enrollment Status
Enrollment status is reported by the school you attended, and indicates whether you are, or were, full-time, three-quarter time, half-time, less than half-time, withdrawn, graduated, etc.
Entrance Counseling
Exit counseling provides important information to prepare you repay your federal student loan(s). Topics include: Contact Settings, My Loans, Preparing to Repay, Determining Your Repayment Strategy. Exit counseling is available at: https://studentaid.gov/exit-counseling/.
Exit Counseling
Entrance counseling explains your rights and the obligations you agree to meet as a condition of accepting a Direct Loan. More information about entrance counseling is available at: https://studentaid.gov/entrance-counseling/.
Entrance Counseling
Entrance counseling explains your rights and the obligations you agree to meet as a condition of accepting a Direct Loan. More information about entrance counseling is available at: https://studentaid.gov/entrance-counseling/.
Extended Repayment Plan
The Extended Repayment Plan allows you to repay your loans over an extended period. Payments are made for up to 25 years. There are specific eligibility requirements to qualify for this plan.
Federal Family Education Loan (FFEL) program
The Federal Family Education Loan (FFEL) Program was a program that worked with private lenders to provide education loans guaranteed by the federal government. The FFEL Program ended in 2010. All loans are now made through the Direct Loan Program.
Federal Pell Grant Program
The Pell Grant is the largest federal grant program offered to undergraduates. It is designed to assist students from low-income households. To qualify for a Pell Grant, a student must demonstrate financial need by completing and submitting the FAFSA® form.
Federal Perkins Loan
A Perkins Loan was available to undergraduate, graduate, and professional students until Sept. 30, 2017; the program has since expired. The Perkins Loan is a subsidized loan, meaning the federal government pays the loan’s interest while the borrower is in school.
Federal Student Aid
A Perkins Loan was available to undergraduate, graduate, and professional students until Sept. 30, 2017; the program has since expired. The Perkins Loan is a subsidized loan, meaning the federal government pays the loan’s interest while the borrower is in school.
Federal Perkins Loan
A Perkins Loan was available to undergraduate, graduate, and professional students until Sept. 30, 2017; the program has since expired. The Perkins Loan is a subsidized loan, meaning the federal government pays the loan’s interest while the borrower is in school.
Federal Perkins Loan
A Perkins Loan was available to undergraduate, graduate, and professional students until Sept. 30, 2017; the program has since expired. The Perkins Loan is a subsidized loan, meaning the federal government pays the loan’s interest while the borrower is in school.