Glossary of Student Loan Related Terms

Academic Period

A measured period of enrollment (e.g. a semester, quarter, clock hours, year etc.)

Academic Year

The period during which school is in session, consisting of at least 30 weeks of instructional time. The school year typically runs from the beginning of September through the end of May at most colleges and universities.

Accrual Date

The date on which interest charges on an educational loan begin to accrue.

Accrued Interest

Interest that accumulates on the unpaid principal balance of a loan.

Achievement Tests (SAT II)

A collection of tests that measure the student's proficiency and accumulated knowledge of specific subject areas. Different schools require different achievement tests as part of their admissions requirements. Since March 1994, these tests are known as the SAT II tests.

ACT

American College Testing Program

Adjusted Available Income

In the Federal Methodology, the remaining income after the allowances (taxes and a basic living allowance) have been subtracted.

Admit-Deny

A practice in which a school will admit marginal students, but not award them any financial aid. 

Advanced Placement (AP)

College Board program that offers students the opportunity to take college-level courses while they are enrolled in high school. Students may gain advanced standing and/or earn college credit through their performance on the Advanced Placement examinations given each year in May.

Advanced Placement Test (AP)

Test used to earn credit for college subjects studied in high school. they are offered by ETS in the spring. AP tests are scored on a scale from 1 to 5 (5 being the best possible score).

Adverse Credit

Negative information regarding a person's pattern of borrowing and repayment of debts as reported to National Credit Bureaus. This information could contribute to the denial of a PLUS or private loan application.

AFDC

Aid to Families with Dependent Children

AFSA

Association for Federal Student Assistance

AFSA Data Corporation

A servicer of Federal loans.

ALAS

Auxiliary Loans to Assist Students (previous loan type)

American College Test (ACT)

One of two national standardized college entrance examinations used in the U.S. The other is the SAT. The ACT is widely used in the West and Midwest. most universities require either the ACT or the SAT as part of an application for admission.

American College Testing Program Assessment (ACT)

Test required by some colleges for admissions.

American Student Assistance Corporation (ASA)

Guarantor of federal loans in Massachusetts and Washington D.C.

Amortization

The process of gradually paying off a loan over time through scheduled payments of principal and interest.

Annual Loan Limit

The maximum loan amount that may be granted per academic year to a borrower for a particular program.

Annual Percentage Rate (APR)

The yearly cost of the loan to the borrower. It reflects all finance charges, including interest (if applicable), guarantee fee (if applicable) and origination fee (if applicable).

Anticipated Disbursement Report

School report containing the following information: loan guarantor, loan sequence, loan number, student Social Security Number (SSN), last name, first name, middle initial, disbursement date, promissory note received, disbursement type, source, guarantee amount, disbursement amount, origination fee and guarantee fee.

AP

Advanced Placement

Appeal

A formal request to have a financial aid administrator review your aid eligibility and possibly use professional judgment to adjust the figures. For example, if you believe the financial information on your financial aid application does not reflect your family's current ability to pay (because of death of a parent, unemployment, or other circumstances, you should definitely make an appeal. The financial aid administrator may require documentation of the special circumstances or of other information listed on your financial aid application.

Applicant

Person who completes and submits a loan application. 1. Under the Stafford Loan Program, only the student may be the applicant. 2. Under PLUS, parents, step-parents, or legal guardians may be the applicants for loans covering educational costs of dependent undergraduate students.3. For Private loans, students and/or any other credit worthy borrower or co-borrower may apply depending upon the loan program. 4.Under the Consolidation loan program, only the student or former student may be the applicant.

Application

The form used by a borrower to apply for a loan. The form may be a combined loan application and promissory note.

Application Status Report

School report containing the following information: student Social Security Number (SSN), name, loan program, requested loan amount, school certification amount, lender approved amount, application status and status date.

Approved

A status assigned to a loan application that has met the loan program's eligibility criteria. After a loan is approved, it can be scheduled for disbursement.

Asset

An item of value, such as a home, business, farm, real estate, stocks, bonds, mutual funds, cash, certificates of deposit, bank accounts, trust funds and other property and investments.

Asset Protection Allowance

A portion of your parents' assets that are not included in the calculation of the parent contribution, as calculated by the Federal Methodology need analysis formula. The asset protection allowance increases with the parents' age.

Assistantship

Student employment, usually referring to departmental research assistance or student teaching.

Associate Degree

The degree granted by two-year colleges.

Auto Debit

Loan payments deducted automatically from checking or savings account on a monthly basis.

Automated Clearing House (ACH)

An alternative method for pre-authorized, electronically transmitted transfers of funds between one person's or organization's account to another's.

Awaiting Signature

The status assigned to a loan account that Nellie Mae cannot continue to process because Nellie Mae has not received the signed promissory note from the applicant.

Award Letter

An official document issued by a school's financial aid office that lists all of the financial aid awarded to the student. This letter provides details on their analysis of your financial need and the breakdown of your financial aid package according to amount, source and type of aid. The award letter will include the terms and conditions for the financial aid and information about the cost of attendance. You are required to sign a copy of the letter, indicating whether you accept or decline each source of aid and return it to the financial aid office. Some schools call the award letter the "Financial Aid Notification (FAN)."

Award Year

The academic year for which financial aid is requested (or received).