Financial Aid - Glossary

Some important terms related to financial aid are given below:

Cost of attendance (COA)

COA is the amount it will cost a student to go to school. Two-year and four-year colleges will calculate the COA of a student to show the total cost for the school year. Schools with programs that last for example, 18 months might give you a COA that covers a time period other than a year.

Award Year

It is the school year for which financial aid is used to fund your education.

Master Promissory Note (MPN)

Master Promissory Note (MPN) is a legal document where you promise to repay your loan(s) and any accrued interest and fees to the U.S. Department of Education. The MPN also explains the terms and conditions of your loan(s); for example your cancellation provision and interest rates.

Loan Servicer

The company that handles your billing and services of the federal student loan is a loan servicer. The servicer will explain repayment plans and help you with other tasks related to federal student loan. The student should be in contact with the loan servicer.

Homeschool

Homeschool is a school in which children are educated at home either by parents, legal guardians, or tutors, rather than traditional public or private school.

Interest

Interest is paid by a borrower to a lender. Interest is the loan expense charged for the use of borrowed money. 

Loan Forgiveness

Loan forgiveness is cancellation of total or some portion of the federal student loan that you have taken. If your loan is forgiven, you are no longer responsible for repaying that remaining portion of the loan.

Expected Family Contribution (EFC)

Your Expected Family Contribution (EFC) is an index number that college financial aid staff use to determine your financial need. The aid is calculated based upon your EFC.

Student Aid Report (SAR)

The summary of the information that you have after submitting your FAFSA is Student Aid Report or SAR. A student usually receives this report 7-10 days after submission. 

Room and Board

The food and housing allowance that a student gets while attending college or career school is Room and Board.

Federal Work-Study

Federal Work-Study is a federal student aid program that provides part-time employment while you are enrolled in school to help pay your education expenses.

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