Glossary

Accreditation: The procedure by which an impartial organization or body thoroughly assesses a school's ability to provide appropriate faculty, curriculum, and facilities for you to pursue a particular field of study. Standards for accreditation vary significantly among organizations. Generally, an institution must be accredited by a nationally recognized accrediting agency or association to be eligible for federal student aid funds. The U.S. Department of Education periodically publishes a list of recognized accrediting bodies in the Federal Register. To see the most current list, click here: http://www.ifap.ed.gov/agencies/doc0028_bodyoftext.htm.   Accrued Interest: Unpaid interest on that accrues on the loan principal.   Annual Percentage Rate (APR): The interest rate on a loan for a one-year period.   BCC:  Bergen Community College.   Capitalization: The addition of unpaid accrued interest to the principal balance of a loan.   Consolidation: Combining several education loans into one new loan.   Default:  Failure to repay a loan in accordance with the terms of the promissory note. Default occurs in federal student loans after 270 days of non-payment.   Deferment: An approved temporary suspension of loan payments based on specific events and criteria.   Delinquency: Failure to make scheduled loan payments when due as specified in the promissory note.   Direct Loan (DL) Program: A student loan program administered by the U.S. .Department of Education. Students borrow directly from the federal government instead of from a private lender.   Disbursement: A transaction that occurs when a lender releases loan funds.   Expected Family Contribution (EFC): An amount, established by law, that attempts to measure a family's financial strength. This calculation is based on family income, assets, the number of students in college and family size. The EFC is used in determining financial need for federal student aid.   FAFSA: Free Application for Federal Student Aid. An application that must be submitted to receive any form of federal student aid.  Schools and states also frequently use FAFSA data in awarding state and private aid.   FFEL: Federal Family Education Loan Program. Private lenders provide loans to students and parents.   Financial Need: The difference between a student's educational costs and their Expected Family Contribution (EFC).   Forbearance: The approved temporary suspension, reduction, or extension of loan payments due to a financial hardship. Interest continues to accrue during periods of forbearance.   Free Application for Federal Student Aid:  See FAFSA above.   Grace Period: Generally, a six month period following a student's graduation or withdrawal from College. The grace period also begins however anytime a student drops below half-time status (six credit hours).    Grant: Financial aid that does not have to be repaid. Generally, grants are for undergraduate students, and the grant amount is based on need, school cost, and enrollment status.   Guarantor: The agency or institution that repays lenders in the event of a default in the FFEL Program.   Interest: The dollar amount charged to borrow money.   Lender: The institution that provides the student loan money to be borrowed.   Loan: Borrowed money that must be repaid with interest. Both undergraduate and graduate students may borrow money. Parents may also borrow to pay education expenses for dependent undergraduate students who are enrolled at least half-time. Maximum loan amounts increase with each year of completed study.   National Student Loan Data System (NSLDS): A database of federal student loan borrowers. If you are a borrower and would like to find out information about your student loans, use the NSLDS Financial Aid Review service, operated by the U.S. Department of Education. By entering your social security number, date of birth, and PIN, you will be able to access your current loan information online.  Note that NSLDS has information only on loans the U.S. Department of Education administers.   Perkins Loans: Low-interest loans offered by some schools for undergraduates and graduate students. The school is the lender.   PIN: Personal Identification Number. Your PIN serves as your electronic signature and gives you access to your personal records with the Department of Education.  A pin allows applicants to complete the FAFSA online.   PLUS Loans: Loans made to qualifying parents of dependent undergraduate students enrolled at least half time at a participating school.  Federal Plus Loans are available through the Direct Loan Program and the Federal Family Education Loan Program (FFEL).   Promissory Note: The binding legal contract between the lender and the borrower. By signing this note, the borrower is obligated to repay the loan as agreed upon in the terms of the contract.   Scholarships: Awards that usually do not have to be repaid. They are given to students who demonstrate high academic promise or achievement in areas such as academics, athletics, music, art or other disciplines.  The U.S. Department of Education does not provide scholarships, but many schools, states, and private organizations do.   Servicer: An organization that acts on behalf of the lender to administer a student loan account.  Often the borrower deals with the loan service when there are questions about repayment.   Stafford Loans: Loans made available to students through the Direct Loan Program and the Federal Family Education Loan Program (FFEL).   State Grant Program:  Funding coordinated by a state agency that provides grants to needy state residents who meet certain other eligibility criteria.   Student Aid Report (SAR): The report you receive after you submit your FAFSA.  The SAR summarizes the information on your FAFSA. The schools you list on your application receive electronic copies of your SAR.  If that information is complete and accurate, and if you're eligible, your school will use your SAR in awarding federal student aid.   Subsidized Loans: Loans on which the federal government pays the interest until the student enters repayment as well as during periods of deferment.  Subsidized loans are awarded on the basis of financial need.    Undergraduate: A student who has not yet received a first bachelor's degree.   Unsubsidized Loans: Loans on which interest accrues during the in-school period, grace period, and periods of deferment. Individual students, and not the federal government, are responsible for paying all accrued interest on Unsubsidized loans. These loans are not based on financial need.   Federal Work study: The Federal Work-Study program provides jobs for students who demonstrate financial need, allowing them to earn money to help pay education expenses.  Jobs are either on campus or at approved off campus sites.  Off-campus jobs must be related to community service.