Glossary of Financial Aid Terms

Glossary of Financial Aid Terms

Cost of Attendance:

This refers to the estimated cost of attending a post-secondary school for one academic year.


Money set aside for coursework and classes.


Money assessed for additional college expenses including access to technology and use of recreational facilities.


This includes charges for on-campus students residing in a residence hall or an estimate for an off-campus student to cover utilities and rent.


This refers to a meal plan cost or the estimate of how much it will be to prepare food from home.


This refers to school supplies and books.

Parking and Transportation:

This could include a bus pass, car, insurance, transit, etc.

Direct Costs:

The Cost of Attendance includes charges that the student/family pays to the college directly.

Indirect Costs:

This includes expense estimates in the Cost of Attendance that are not directly paid to the school.

Enrollment Status:

Academic courses or workload as outlined by the school where a student attends for a set academic period defines the enrollment status. Typically, this relates to the credit hours taken by a student during a specific academic period. For example, time may be defined as less-than-half-time, half-time, three-quarter-time, or full-time studies.

Program Level:

The program level refers to the degree-granting program that the student is enrolled in. This may include an undergraduate degree, an associate degree, or a baccalaureate degree. This may include a post-baccalaureate such as teaching certification. The graduate program includes students obtaining their graduate certificate, professional degree, a doctorate, or master’s degree. The type and amount of financial aid that a student is eligible for considers their program level.

Private Loan:

A parent or student loan from an institutional lender, state-affiliated lender, or commercial lender may be sought to pay for the annual Cost of Attendance, minus any additional financial aid given. There are varying fees, interest rates and repayment schedules for private loans. These specific loans generally require the applicant to have excellent credit and possibly a creditworthy co-signer. Loan repayment typically begins immediately after the funds are disbursed.

Gift Aid:

Gift Aid funds do not need to be repaid if the student meets specific criteria. They will have to repay the amount if they do not meet certain criteria including a service requirement or finishing the period that the aid was delivered for.

Gift Aid includes awards, scholarships, grants, waivers, remissions, etc. It can be given under many considerations including athletics, academic excellence, theatre or music talent, financial need, career aspirations, or being affiliated with certain groups, among other reasons.


A scholarship is Gift Aid that is based on merit including talent, academic excellence, career aspirations or affiliation with certain groups. It may be based on a combination of need and merit.


A grant is defined as Gift Aid that is normally based on financial need.

Net Price:

The net price is the total of the indirect and direct costs that remain after all Gift Aid has been applied. The net price can be paid for in numerous ways including education loans, income and savings.

Federal Student Loan:

These funds need to be paid back by the student after some time. To qualify for Federal funds, students have to sign an MPN or Master Promissory note and finish Entrance Counseling before receiving these loans.

Repayment starts 6 months after the student stops being enrolled at least half-time. There are delaying payment options available. The student needs to be enrolled in a minimum of half-time in a program that is eligible to qualify.


The need is assessed as the student’s Cost of Attendance minus their Family Financial Responsibility or Expected Family Contribution, if applicable.

Unmet Need:

This is defined by the student's Cost of Attendance, minus their Family Financial Responsibility or  Expected Family Contribution if applicable, minus any additional need-based aid including Federal Direct Subsidized Loans, Federal Work-Study, or Gift Aid.


This refers to the school’s expectation that the student contributes to their education costs using a variety of means such as summer savings, student employment, Federal Work-Study, and/or a combination of loans.

FWS or Federal Work-Study:

This is an opportunity for students who demonstrate financial need to help pay their school expenses via part-time employment. This federal program is administered by the school. Students have the responsibility of finding employment that qualifies and is paid out with a paycheck regularly. 

Educational Loan:

This is a type of financial aid that must be repaid. There are varying interest rates, fees, borrower protections and repayment rates associated with these loans. Make sure you can break everything down to determine your monthly repayment amount.

Federal Direct Subsidized Student Loan:

Money is given to the student by the ED or U.S. Department of Education through the school. Undergrad students that demonstrate financial need can qualify for a subsidized loan. The government pays the loan interest while the student is enrolled in a minimum of half-time studies. They pay the interest during times that the government has consented to repayment deferment.

Note, there are annual limits on the amount of funds students may borrow. These amounts vary by the student’s independent or dependent status and also which academic year they are attending in school.

Federal Direct Graduate PLUS Loan:

The U.S. Department of Education offers loan funds through the school to graduate students. This program enables qualifying graduate students who do not have any negative credit history to apply for a loan. The amount they can apply for is up to their Cost of Attendance every year minus any additional financial aid they acquire.

Federal Direct Unsubsidized Student Loan:

This type of loan offers funds to students through the school via the U.S. Department of Education. Regardless of their need, graduate students and undergrads alike can qualify for an unsubsidized loan. They will only be eligible if they filed the FAFSA or the Free Application for Federal Student Aid.

Note that interest accrual starts right away. The student can choose to pay interest during their enrollment or when they start the repayment phase. Again, there are annual limits on the loan amount that may be accessed. These amounts are determined by the student’s status as either an independent or a dependant as well as their academic school year.

Federal Direct Parent PLUS Loan (PLUS):

This particular loan is offered to dependent ungraduated students’ parents. It is given through the school via the U.S. Department of Education. It enables parents who have no negative credit history to apply for a loan amount up to the Cost of Attendance each year, minus any additional financial aid the dependent student received. After the loan has been given, repayment of interest and the principal starts immediately. There are certain options to delay repayment that may be available.  

EFC or Expected Family Contribution:

This is an index showcasing eligibility that the staff at college financial aid offices rely on to determine the amount of financial aid one would receive if they attended their institution. The EFC utilizes a formula based on law and upon the FAFSA information the family or the student provided on the Free Application for Federal Student Aid to calculate the amount.

FFR or Family Financial Responsibility:

Numerous institutions offer need-based grants and scholarships by relying on a more detailed calculation of family financial circumstances. They use the information on the CSS PROFILE or have their own school financial aid paperwork. This may generate a lower or higher figure compared to what the FAFSA indicates with its EFC or estimate of Expected Family Contribution.

FSEOG or Federal Supplemental Educational Opportunity Grant:

Priority for this award is given to recipients of the Federal Pell Grant. The FSEOG is a grant from the federal government that is given to qualified undergrads who demonstrate a significant financial need.

Federal Pell Grant:

This grant is offered by the Federal government to undergrad students who show significant financial need. They showcase an Expected Family Contribution below a specific threshold as outlined by the government. The student’s Enrollment Status determines how the Pell Grant award is prorated.

IASG or Iraq and Afghanistan Service Grant:

This is a federal grant offered to qualifying students who have a guardian or parent who passed away due to military service in Afghanistan or Iraq after September 11, 2001. Note, a student is not able to receive an IASG if they are eligible for a Federal Pell Grant.

ISAs or Income Share Agreement:

An Income Share Agreement is a contract with the institution or private enterprise and the student to pay a portion of their future earnings for a specific timeframe after graduation in exchange for money to pay for their education costs during enrollment.

TEACH or Teacher Education Assistance for College and Higher Education Grants:

These are federal grants for graduate and undergrad students that are awarded in exchange for future teaching work in certain high-need subjects and low-income secondary or elementary locations. If a student does not finish their required teaching service, this grant transitions into a Federal Direct Unsubsidized Loan that must be paid back.


Verification is the federally mandated confirmation process to ensure the data provided by the selected applicant on the FAFSA is accurate. To partake in the verification process, the student, their spouse, or parents if applicable must provide specific documents for review to the school. If the supplied documents do not match what was reported on the Free Application for Federal Student Aid, verification can cause changes to a students’ financial aid offers or changes to their eligibility for financial aid.