Paying for College
All the terms you need to know to make the best decisions about paying for college. Thanks for US News and World Report!
Terms in this set (26)
Federal Student Aid
The largest form of student aid in the country, federal aid programs come in the form of government grants, loans, and work-study assistance
Need to be repaid!!! Come in two varieties: Federal and private. Federal student loans don't have to be paid while you're in college, and there are also a variety of loan forgiveness programs out there post-graduation. The rates and terms are generally more flexible than private loans
Type of aid primarily awarded for academic merit (good grades) or for something you have accomplished (volunteer work or a specific project). Do not need to be repaid! Generally scholarships must be applied for.
Free money. Comes from the state or federal government, from the college itself, or from private sources—provide money for college that doesn't have to be paid back.
The amount of a student's total cost of attendance that isn't covered by the expected family contribution or outside grants and scholarships
FAFSA (Free Application for Federal Student Aid)
One of the first steps in the financial aid process, and determines the amount that you or your family will be contributing to your postsecondary education
Student Aid Report (SAR)
This is the report you will receive once you have submitted your FAFSA. It will contain your EFC, whether you may be eligible for Pell Grants and outline all the information that colleges will use when determining your financial aid package
Data Reference Number
This is a number that will appear on your SAR. It is a reference number that allows colleges to easily locate your SAR (especially colleges you may not have initially sent your FAFSA information to)
Cost of Attendance
Total expense to go to college including tuition, room and board, fees, books and supplies, computer costs, transportation to/from home and health insurance.
Expected Family Contribution (EFC)
Measure of your family's financial strength, and how much of your college costs it should plan to cover. Will appear on your SAR.
"Out of pocket" expenses that a student pays which is calculated as the "sticker price" of a college minus the financial aid received
Outlines your financial aid package from the college(s) to which you applied
Room and Board
Cost of housing and food while at college
"Sticker price" of your education, and does not include room and board, textbooks, or other fees
Provides funds to eligible students (see FAFSA above) for part-time employment to help finance the costs of postsecondary education
A Federal program based on financial need; provides up to $5,500 in student aid and does not need to be repaid
Low-interest federal student loans for undergraduate and graduate students with exceptional financial need.
Direct Loans (formerly Stafford Loans)
Low-interest loans from the Department of Education for students and parents to help pay for the cost of a student's education after high school. Must be repaid!!! Available to any student, but there are two types: Subsidized and Unsubsidized. Students can borrow $5,500 as freshman, $6,500 as sophomores and $7,500 for junior and senior years.
Direct Subsidized Loans
Low-interest Direct Loans where the government pays the interest on the loans while the student is enrolled in school. These are for students who demonstrate a high financial need.
Direct Unsubsidized Loans
Low-interest Direct Loans where the student pays the interest on the loans while the student is enrolled in school. These are for students who do not demonstrate a high financial need.
A contract signed by the student agreeing to pay back all student loan obligations
The organization that collects payments on a federal student loan, responds to customer service inquiries, and performs other administrative tasks associated with maintaining a loan on behalf of a loan holder. A federal loan servicer is a loan servicer for the U.S. Department of Education.
The amount of the original loan
The cost to borrow money. Interest is calculated as a percentage of the outstanding principal balance.
The maximum time period over which you must repay your student loan. The repayment period may range from 10 years to 30 years, depending on loan amount, loan type, and repayment plan.
Inflation in education costs
Increases in education costs; you can expect 4-6% increases annually to your college costs
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