Award Year:  The time period over which financial aid programs are made available to students.  At PLU, this begins with summer term until the end of spring semester.  May be one, two, or three terms.

Capitalization:  The process whereby the interest that has accrued on an unsubsidized loan is added to the loan principal.

COA:  Cost of Attendance.  The cost of attending college for the student’s enrollment period.  Cost of attendance includes tuition and fees, room and meals, books and supplies, transportation, and personal/miscellaneous expenses.

Consolidation:  The process of combining two or more loans into a single loan at repayment.  The interest rate is typically reset at the weighted average.

Default:  Failure to make payment on your student loan for more than 270 days, resulting in loss of eligibility for further financial aid, a damaged credit record, and possible garnishment of your federal tax returns and/or your loan being sold to a collection agency.

Disclosure Statement:  A statement that notifies borrowers the cost of borrowing a loan.

DL:  Direct Loan.  Federal Loan programs.  See

EFC:  Expected Family Contribution.  The dollar amount the FAFSA calculates you (and your parents if you are a dependent student) can contribute toward your college costs for the academic year or enrollment period, based on the federal methodology need analysis formula.

Entrance Interview:  A session a borrower must complete in order to receive a Federal Direct, Nursing, or Grad PLUS loan that advises the student of their rights and responsibilities as the loan borrower.

Exit Interview:  A session a student must complete when they graduate or drop below half time enrollment if they borrowed a Federal Direct, Perkins, Nursing or Grad PLUS loan.  Advises the student of their rights and responsibilities as they are about to enter repayment.

FAFSA: Free Application for Federal Student Aid.  The application required to apply for any need-based aid and all federal and WA state financial aid aid programs.  Application is made on-line at

FAFSA4CASTER:  A shortened version of the FAFSA that provides you with an estimate of your EFC.  See

FERPA: Family Educational Rights and Privacy Act.  The federal legislation that requires schools to protect students’ personally identifiable information and educational record and provides students with rights to inspect and review their school records.

Gift Aid:  Scholarships and grants that do not have to be repaid. Free money.

Grace Period:  The six or nine month period between leaving school and entering repayment on your student loans.

Grant: Free money, generally awarded on the basis of financial need.

I-9:  A US Citizenship and Immigration Service document that everyone must complete before they can begin working in the United States, including work study programs. (see

MPN:  Master Promissory Note.  The document borrowers must sign in order to receive a federal student loan.

Net Price Calculator:  A program each school is required to make available on their website that provides an estimate of your “net price” to attend that school, after deducting the amount of grants and scholarships you could reasonably expect to receive at that school.

Need: The difference between the school’s cost of attendance (COA) and the family’s expected family contribution  (EFC).

Principal:  The amount borrowed, not including accrued interest (unless capitalized).

Professional Judgment:  The authority of the financial aid administrator at your school to use supplemental information to modify your FAFSA generated EFC to take into account extraordinary circumstances  affecting the family’s ability to pay for college.   This authority may be exercised differently at each school’s discretion.

R2T4:  Return of Title IV aid.  The federal formula that calculates how much federal financial aid must be returned to the federal government if a student completely withdraws from school before 60% of the enrollment period has elapsed.

SAR:  Student Aid Report:  The summary output of your FAFSA application.  The SAR is emailed to you if you provided an email address when completing the FAFSA on-line.

SAP:  Satisfactory Academic Progress.  The federal, state, and institutional requirement that you be making satisfactory academic progress toward completion of your degree or certificate program, based on credits earned and grade point average.  Also provides for the maximum duration you can continue to receive aid.

Scholarship:  Free money, generally awarded for past achievement in academics, athletics, talent, or other meritorious criteria.  Generally not based on financial need.

Self Help:  Those financial aid programs that are not gift aid, including student loans and work study.

Subsidized Loan:  A loan that does not accrue interest until the student enters repayment.  This includes the Federal Direct, Perkins, and Nursing loans.

NSLDS:  National Student Loan Data System: The federal data base that keeps track of your federal student loans and grants received.  Does not include the Federal Nursing Loan nor private student loans. See

Net Price:  The difference between a school Cost of Attendance (COA) and the amount of scholarships and grants offered to the student.

Special Circumstances:  Conditions (such as loss of employment) which are not addressed in the FAFSA application which could affect the family’s ability to contribute toward their EFC.  Financial aid administrators would use professional judgment to take special circumstances into consideration.

TILA:  Truth in Lending Act.  Federal legislation that require lenders to make borrowers aware of  the terms, conditions, and cost of borrowing a loan by providing the required Disclosure Statement.

Title IV:  The federal Higher Education Act of 1965 which created the initial foundation for the federal student aid programs.  The act is re-authorized every four, six or ten years or when provisions of the act are set to expire.

Unsubsidized Loan:  A loan whose interest begins to accrue upon disbursement.  This includes the Unsubsidized Direct Loan, the Federal Parent PLUS loan, the Federal Grad/Professsional PLUS Loan, as well as all private/alternative loans.

Verification:  The process that requires selected FAFSA applicants to submit copies of their federal tax returns and a Verification Worksheet to confirm the accuracy of the information submitted on their FAFSA.