Aid Definitions

Financing Your EducationAid Definitions

Aid Definitions

Definitions are adapted from those given on the Financial Aid website of the Department of Education.

Academic Year

A period of time used to measure a quantity of study. For example, a school’s academic year may consist of a fall and spring semester during which a full-time undergraduate student must complete 24 semester hours. Academic years vary from school to school and even from educational program to educational program at the same school.



The process where interest accumulates on a loan. When "interest accrues on a loan," the interest due on the loan is accumulating.


Award Letter

The award letter states the types and amount of financial aid that GS will provide to matriculating students.



Individual who signed and agreed to the terms in the promissory note and is responsible for repaying a loan.



With certain loans, such as subsidized Federal Direct  Loans, the U.S. Department of Education pays the interest that accrues on these loans while the student is enrolled at least half-time and during periods of deferment. However, with subsidized loans in forbearance, unsubsidized loans or PLUS Loans, the student or the student’s parents and graduate or professional degree students are responsible for paying interest as it accrues on these loans.

When the interest is not paid, it is capitalized or added to the principal balance, which increases the outstanding principal amount due on this loan. Interest that is capitalized and, therefore, added to the original amount of the loan subsequently accrues interest, adding an additional expense to the loan.



The process of combining one or more loans into a single new loan.


Continuing Student

Continuing students are those who have completed at least one semester at GS. Students on leave of absence who have not been enrolled for 1-3 years are considered continuing students and, if planning to return in the upcoming academic year, should apply for financial aid by the published deadlines.

Students on leave of absence who have not been enrolled for more than 3 years or who have had to reapply for admission are not considered continuing students and may apply by the published deadlines for new students.


Cost of Attendance (COA)

The total amount it will cost you to go to school—usually expressed as a yearly figure. The COA includes tuition and fees; living expenses; and allowances for books, supplies, transportation, loan fees, and other miscellaneous expenses.



Failure to repay a loan according to the terms agreed to when you signed a promissory note. For the FFEL and Direct Loan programs, default is more specific—it occurs if you fail to make a payment for 270 days if you repay monthly (or 330 days if your payments are due less frequently).

The consequences of default are severe. Your school, the lender or agency that holds your loan, the state and the federal government may all take action to recover the money, including notifying national credit bureaus of your default. This may affect your credit rating for as long as seven years. For example, you might find it difficult to borrow money from a bank to buy a car or a house. In addition, the Internal Revenue Service can withhold your U.S. individual income tax refund and apply it to the amount you owe, or the agency holding your loan might ask your employer to deduct payments from your paycheck. Also, you may be liable for loan collection expenses. If you return to school, you’re not entitled to receive additional federal student financial aid. Legal action also might be taken against you.

In many cases, default can be avoided by submitting a request for a deferment, forbearance, discharge, or cancellation and by providing the required documentation.


Dependent student

A student who does not meet any of the criteria to be considered an independent student. An independent student meets one of the following criteria:

  • at least 24 years old;
  • married;
  • a veteran or member of the U.S. armed forces;
  • an orphan;
  • a ward of the court; or
  • someone with legal dependents other than a spouse.


Payment of loan proceeds by the lender. During consolidation, this term refers to sending payoffs to the loan holders of the underlying loans being consolidated.


Eligible Noncitizen

You must be one of the following to receive federal student aid:

  • U.S. citizen
  • U.S. national (includes natives of American Samoa or Swain’s Island)
  • U.S. permanent resident who has an I-151, I-551, or I-551C (Permanent Resident Card)


Eligible noncitizens who wish to receive federal aid must have an Arrival-Departure Record (I-94) from U.S. Citizenship and Immigration Services (USCIS) showing one of the following designations:

  • "Refugee"
  • "Asylum Granted"
  • "Cuban-Haitian Entrant, Status Pending"
  • "Conditional Entrant" (valid only if issued before April 1, 1980)
  • Victims of human trafficking, T-visa (T-2, T-3, or T-4, etc.) holder
  • "Parolee" (You must be paroled into the United States for at least one year and you must be able to provide evidence from the USCIS that you are in the United States for other than a temporary purpose and that you intend to become a U.S. citizen or permanent resident.)

If you have only a Notice of Approval to Apply for Permanent Residence (I-171 or I-464), you aren’t eligible for federal student aid.

If you’re in the United States on certain visas, including an F1 or F2 student visa, or a J1 or J2 exchange visitor visa, you’re not eligible for federal student aid.

Also, persons with G series visas (pertaining to international organizations) are not eligible. For more information about other types of visas that are not acceptable, GS financial-aid applicants should consult a financial aid counselor in the Office of Educational Financing in 408 Lewisohn Hall.

Citizens of the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau are eligible only for Federal Pell Grants, Federal Supplemental Educational Opportunity Grants, or Federal Work-Study. These financial-aid applicants should consult the Office of Educational Financing in 408 Lewisohn Hall for more information.


Eligible Program

A program of organized instruction or study that leads to an academic, professional, or vocational degree or certificate, or other recognized educational credential. To receive federal student aid, you must be enrolled in an eligible program, with two exceptions:

  • If a school has told you that you must take certain course work to qualify for admission into one of its eligible programs, you can get a Federal Direct Loan for up to 12 consecutive months while you’re completing that preparatory course work. You must be enrolled at least half time, and you must meet the usual student aid eligibility requirements.
  • If you’re enrolled at least half-time in a program to obtain a professional credential or certification required by a state for employment as an elementary or secondary school teacher, you can get Federal Work-Study, Federal Perkins Loan*, a Federal Direct Loan, or your parents can get a PLUS Loan, while you’re enrolled in that program.

* As of October 1, 2017, per federal regulations, the Federal Perkins Loan program has been discontinued and is no longer available.


Expected Family Contribution

Your Expected Family Contribution (EFC) is the figure that’s used to determine your eligibility for federal student financial aid. Your EFC is derived from the financial information you provided in your FAFSA application. Your EFC is reported to you on your Student Aid Report (SAR).


Federal Family Education Loan Program (FFEL)

FFEL Loans include subsidized and unsubsidized FFEL Direct Loans, FFEL Plus Loans, and FFEL Consolidation Loans. Borrowers repay these loans to the bank or private lender that provided the loan.


Financial Aid Package

The total amount of financial aid (federal and nonfederal) a student is offered by the school. The financial aid administrator at a postsecondary institution combines various forms of aid into a “package” to help meet a student’s education costs. Using available resources to give each student the best possible package of aid is one of the aid administrator’s major responsibilities. Because funds are often limited, an aid package might fall short of the amount a student needs to cover the full cost of attendance. Also, the amount of federal student aid in a package is affected by other sources of aid received (scholarships, state aid, etc.).


Grace period

After borrowers graduate, leave school, or drop below half-time enrollment, loans that were made for that period of study have several months before payments are due. This period is called the "grace period."

During the grace period, no interest accrues on subsidized loans. Interest accrues on unsubsidized loans during grace periods, and this interest is capitalized when borrowers' loans enter repayment (if not paid in advance).


Guaranty Agency

The guaranty agency is an organization that administers the Federal Family Education Loan (FFEL) Program in your state. This agency is the best source of information on FFEL Loans. For the name, address and telephone number of the agency serving your state, you can contact the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243).



At GS half-time enrollment is enrollment in at least six points per semester. You must be attending school at least half-time to be eligible for a Federal Direct Loan. Half-time enrollment is not a requirement to receive aid from the Federal Pell Grant, Federal Supplemental Educational Opportunity Grant, Federal Work-Study and Federal Perkins Loan* programs.

* As of October 1, 2017, per federal regulations, the Federal Perkins Loan program has been discontinued and is no longer available.


Independent Student

An independent student meets one of the following criteria:

  • at least 24 years old;
  • married;
  • a veteran or member of the U.S. armed forces;
  • an orphan;
  • a ward of the court; or
  • someone with legal dependents other than a spouse.


A loan expense charged by the lender and paid by the borrower for the use of borrowed money. The expense is calculated as a percentage of the unpaid principal.


National Student Loan Data System (NSLDS)


NSLDS is the database for federal student financial aid where you can find out about the aid you’ve received. If you’ve only just applied for aid, you won’t find any information on NSLDS yet. NSLDS receives data from schools, guaranty agencies, and U.S. Department of Education programs. The NSLDS Web site is generally available 24 hours a day, seven days a week. By using your PIN, you can get information on federal loan and Pell Grant amounts, outstanding balances, the status of your loans and disbursements made. You can access NSLDS at .


Need Analysis


The process of analyzing a student´s financial need, known as need analysis, focuses on determining how much the family reasonably can be expected to contribute towards the student´s education. Traditionally, determination of an applicant´s need is achieved by collecting information about the family´s income, assets, and living expenses. For the federal student aid programs, the law specifies a need analysis formula that produces the Expected Family Contribution (EFC). The EFC and the college´s cost of attendance are used to establish the student´s need as well as to award grants, campus-based aid, and subsidized loans.



The amount of money borrowed by the student. Interest is charged on this amount.


Promissory Note

A promissory note is a binding legal document you sign when obtaining a student loan. It lists the conditions under which you’re borrowing and the terms under which you agree to pay back the loan. It will include information on how interest is calculated and what deferment and cancellation provisions are available to the borrower. It’s very important to read and save this document because you’ll need to refer to it later when you begin repaying your loan or at other times when you need information about provisions of the loan, such as deferments or forbearances.


Satisfactory Academic Progress

To be eligible to receive federal student financial aid, you must meet and maintain your school’s standards of satisfactory academic progress toward a degree or certificate offered by that institution. Academic standards for GS students are available in the Academic Policies section.


Selective Service Registration

In order to be eligible for federal student aid you must register with the Selective Service if:

  • You are a male born on or after Jan. 1, 1960; and
  • You are at least 18 years old; and
  • You are not currently on active duty in the U.S. Armed Forces.

Citizens of the Federated States of Micronesia, the Republic of the Marshall Islands or the Republic of Palau are exempt from registering.


Student Aid Report

Your Student Aid Report (SAR) summarizes the information you submit on your Free Application for Federal Student Aid (FAFSA) and provides you with your Expected Family Contribution (EFC).

After you apply for federal student financial aid, you'll get your FAFSA results in an e-mail report by the next business day after your FAFSA has been processed or by mail within 7-10 days. This report is called a Student Aid Report, or SAR. Your SAR details all the information you provided on your FAFSA. If there are no corrections or additional information you must provide, the SAR will contain your Expected Family Contribution (EFC), which is the figure that’s used to determine your eligibility for federal student aid. Whether you applied online or by paper, your data will be sent electronically to the schools you listed on your FAFSA.



A loan for which a borrower is not responsible for the interest while in an in-school, grace, or deferment status. Subsidized loans include: Direct Subsidized Loans, Direct Subsidized Consolidation Loans, Federal Direct Subsidized Loans, and Federal Subsudized Consolidation Loans.



A loan for which the borrower is fully responsible for paying the interest regardless of the loan status. Interest on unsubsidized loans accrues from the date of disbursement and continues throughout the life of the loan. Unsubsidized loans include: Direct Unsubsidized Loans, Direct PLUS Loans, Direct Unsubsidized Consolidation Loans, Federal Direct Unsubsidized Loans, Federal PLUS Loans, and Federal Unsubsidized Consolidation Loans.



Verification is a process where your school confirms the data reported on your FAFSA. Your school has the authority to contact you for documentation that supports income and other information that you reported.