Terms You Should Know

Published by Financial Aid Consulting on Friday, 22nd June 2018 - 12:00PM in Terms You Should Know

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The following abridged section from my book Making College Happen-The Realties of Coping With College Costs provides quick explanations of college financial term you should know. 

Terms You Should Know

by Howard Freedman

Copyright 2019 Financial Aid Consulting. All rights reserved. No portion of this article may be reproduced mechanically, electronically, by photocopying or by any other means without expressed written permission of the author.

Howard can be reached at finaidguy@gmail.com

Here are some important terms you should know.

The beginning of wisdom is the definition of terms.”

― Socrates

Award letter

Official offer that includes the cost of attendance, financial aid (scholarships, grants, loan work-study) awarded and net cost. The award can be full or partially accepted or rejected and appealed

Conflicting Information:

Inconsistent and inaccurate data reported on financial aid forms that warrant further review and audit.

Cost of Attendance:

The total projected annual costs of attending a college for the academic year. It includes all costs paid directly to the school as well as indirect costs such as personal expenses, books, and transportation

CSS/Financial Aid Profile:

An additional financial aid form used by certain colleges to EFC (Expected Family Contribution) using a different institutional methodology for award financial aid from institutional versus federal funds

Deferment:

The period during which repayment of the principal and interest of your loan is temporarily delayed.

Early Action:

An accelerated college application process in which students typically must complete their applications from the college before the new year. This is not binding and students may apply to other colleges

Early Decision:

An admissions program that requires the student signs a commitment to commit to a program earlier in the year. Colleges award financial aid at the time of admission but depending on the college may not have the financial leverage to negotiate for more financial aid.

EFC (Expected Family Contribution)

A calculated amount that determines how much a family should (but may not be able) to contribute to the student’s education for the upcoming academic year. This number is derived from the FAFSA form while another EFC is calculated from the CSS/Financial Aid Profile required by certain colleges.

Enrollment Management:

The term used in higher education to describe well-planned strategies and tactics to shape the enrollment of an institution and meet established goals.

FAFSA

Free Application for Federal Student Aid) is available each October for determining need-based financial aid. Federal Loan:

Merit-Based Aid:

Aid awarded not based on need but a student’s academic achievements as well as for special talents and unique traits, such as musical or athletic skills. Awards and scholarships like this are usually awarded by states, college admissions, , private groups or individuals.

Need-Blind:

A policy that does not consider an applicant's financial situation in its admissions decision.

Need Aware:

An admission policy in which the admitting institution considers an applicant’s financial situation when deciding admission

Professional Judgment:

The authority of a school's financial aid administrator to make adjustments to the data elements on the FAFSA and to override a student's dependency status to address exceptional circumstances related the FAFSA.

SAR:

A paper or electronic document generated after the FAFSA is processed. It that gives you some basic information that about your eligibility for federal student aid and lists your answers to the questions on your Free Application for Federal Student Aid (FAFSA). It is also used for reviewing your information for accuracy.

Self Help Aid:

Financial aid that includes student employment and loans for which the student is responsible.

Unmet or Financial Need:

The is the difference between the Cost of Attendance and Expected Family Contribution. It is then offset by financial aid controlled by the school that is awarding it.

Verification:

The process to confirm the information you provided on the FAFSA. Verification selection can be random or may be required if your FAFSA data was incomplete, estimated or inconsistent. The U.S. Department of Education selects some students for the verification process. Others are selected if we find conflicting information.


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