General Information Online Services

Glossary of Financial Aid Terms

Academic Year
The period during which school is in session, consisting of at least 30 weeks of instructional time. At the UNIVERSITY OF LA VERNE the school year for undergraduates in the main campus program typically runs from the beginning of September through the end of May. Please see catalog for graduate, doctoral and SCE information.

Accrual Date
The date on which interest charges on an educational loan begin to accrue. See also Subsidized Loan.

Amortization
The process of gradually repaying a loan over an extended period of time through periodic installments of principal and interest.

Award Letter
An official document issued by the ULV financial aid office that lists all of the financial aid awarded to the student. This letter provides details on their analysis of eligibility for financial aid and the breakdown of a financial aid package according to amount, source and type of aid. The award letter includes the terms and conditions for receiving financial aid and information about the cost of attendance. The student is required to sign a copy of the letter, indicating whether to accept or decline each source of aid, and must return it to the ULV financial aid office.

Base Year
The tax year prior to the academic year (award year) for which financial aid is requested. For undergraduates the base year runs from January 1 of the junior year in high school through December 31 of the senior year. Financial information from this year is used to determine eligibility for financial aid. For SCE, CAPA, graduate and doctoral programs, the base year is the preceding tax year.

Cal Grants
Cal Grants are California's largest state-funded financial aid program and are administrated by the California Student Aid Commission. The UNIVERSITY OF LA VERNE participates in Cal Grant A, B, and T programs. A student's eligibility for these awards is based on both the GPA Verification Form and the Free Application for Federal Student Aid (FAFSA). The deadline for applying for the Cal A and the Cal B (undergraduate grants) is March 2nd of the preceding academic year. The deadline for the Cal T application is June 1st.

Cal Grant A
Helps low and middle-income students with college tuition and fees. The award is available for four years of undergraduate study or for a 5th year for eligible students in dedicated five-year programs (architecture, teaching credential).

Cal Grant B
Provides a living allowance (and in some cases tuition and fee assistance) for very low-income, first time freshman students. Awards for first-year students are usually limited to living expenses, books, supplies and transportation. When renewed, this award may also be granted to help with college tuition and fees. If a student is enrolled in a teacher credential program, the Cal Grant B award may be extended an additional year.

Cal Grant T
A tuition and fee award offered for one academic year only. This award aids students who already have a bachelor's degree or higher and are actively working toward an initial teaching credential.

Campus-Based Aid
There are three federal program funds administered by colleges and those are: (1) Federal Supplemental Educational Opportunity Grant, (2) Federal Perkins Loan and (3) Federal Work Study.

College Work-Study (CWS)
College Work-Study is a part time job.

Confirmation Form
This form is included in the Financial Aid Award Packet and must be completed and returned to the ULV Financial Aid Office for processing. The form consists of: (1) Unit Confirmation, (2) Lender Choice, First-Time Borrower, (3&4) decision to accept, decline or reduce federal loans indicated on the financial aid award letter, (5) outside resources you expect to receive, and (6) tuition reimbursement sources.

Cosigner
A cosigner on a loan assumes responsibility for the loan if the borrower should fail to repay it.

Cost of Attendance (COA)
The total amount it should cost the student to attend ULV, including direct costs such as tuition and fees, room and board, estimated allowances for books and supplies, transportation, and personal and incidental expenses. Loan fees, if applicable, are also included in the COA. ULV has established standard budget amounts for students living on-campus and for students living off-campus.

Custodial Parent- For students under age 24
If a student's parents are divorced or separated, the custodial parent is the one with whom the student lived the most during the past 12 months. If the student did not live with either parent the custodial parent is the one who claimed the student as a dependent on the US 1040, 1040 A or 1040 EZ. If the parent (s) do not file a tax return, the financial aid office will ask for supporting documentation.

Default
A loan is in default when the borrower fails to pay several regular installments on time (i.e., payments overdue by 180 days) or otherwise fails to meet the terms and conditions of the loan. If a student should default on a loan, the university, the holder of the loan, the state government and the federal government will take legal action to recover the money, including garnishing wages and withholding income tax refunds. Defaulting on a government loan will make the student ineligible for future federal financial aid, unless a satisfactory repayment schedule is arranged.

Deferment
Occurs when a borrower is allowed to postpone repaying the loan. With a subsidized loan, the federal government pays the interest charges during the deferment period. With an unsubsidized loan, a student is responsible for the interest that accrues during the deferment period. Postponement of interest payment charges is still an option by capitalizing the interest, which increases the size of the loan. Most federal loan programs allow students to defer their loans while they are in school at least half time. If a student does not qualify for a deferment, forbearance may still be an option. Deferment is not an option if the loan is in default.

Delinquent
If the borrower fails to make a payment on time, the borrower is considered delinquent and late fees will be charged. If the borrower misses several payments, the loan goes into default.

Dependency Status
Determines to what degree a student has access to parent financial resources.

Dependent Student
A student under twenty-four years old who does not qualify as an independent student according to federal guidelines. See definition of independent student.

Disbursement
The release of loan funds to the school for delivery to the borrower. Loan funds are first credited to the student's account for payment of tuition, fees, room and board and other school charges. Any excess funds are then paid to the student in cash or by check. Unless the loan amount is under $500, the disbursement will be made in at least two equal installments.

Disclosure Statement
Provides the borrower with information about the actual cost of the loan, including the interest rate, origination, insurance, loan fees and any other types of finance charges. Lenders are required to provide the borrower with a disclosure statement before issuing a loan.

Electronic Data Exchange (EDE)
Program used by participating schools to electronically receive Pell Grant Student Aid Reports (SAR) from the federal processor. At some schools EDE allows students to electronically file their Free Application for Federal Student Aid (FAFSA).

Electronic Funds Transfer (EFT)
Used by ULV and lenders to wire funds for Stafford and PLUS loans directly to participating schools without requiring an intermediate check for the student to endorse.

Eligible Non-Citizen
Someone who is not a US citizen but is nevertheless eligible for Federal student aid. Eligible non-citizens include US permanent residents who are holders of valid green cards, US nationals, holders of form I-94 who have been granted refugee or asylum status and certain other non-citizens. Non-citizens who hold a student visa or an exchange visitor visa are not eligible for Federal student aid.

Entrance Interview
See Loan Interviews.

Exit Interview
See Loan Interviews.

Expected Family Contribution (EFC)
The amount of money that the family is expected to be able to contribute to the student's education, as determined by the Federal Methodology need analysis formula approved by Congress. The EFC includes the parent contribution and the student contribution, and depends on the student's dependency status, family size, number of family members in school, taxable and nontaxable income and assets. The difference between the COA (Cost of Attendance) and the EFC is the student's financial need, and is used in determining the student's eligibility for need-based federal, state and ULV financial aid.

Federal Family Education Loan Program (FFELP)
Includes the Federal Stafford Loan (Subsidized and Unsubsidized) and the Parent Loan for Undergraduate Students (PLUS). The funds for these loans are provided by private lenders such as banks, credit unions and savings & loan associations. These loans are guaranteed against default by the federal government.

Federal Pell Grant
Provides grants to qualified undergraduate students who have financial need and meet requirements for Student Financial Assistance. When the FAFSA is filed every student is automatically considered for a Pell Grant.

Federal Perkins Loan
A low interest, long-term federally funded loan made through school financial aid offices to help needy undergraduate and graduate students pay for post-secondary education.

Federal Processor
The organization that processes the information submitted on the Free Application for Federal Student Aid (FAFSA) and uses it to compute eligibility for federal student aid. There are two federal processors serving specific geographic regions.

Federal Work-Study (FWS)
Program providing students with part-time employment during the school year. Eligibility for FWS is based on need. Money earned from a FWS job is not counted as income for the subsequent year's need analysis process.

Fellowship
A form of aid given to graduate students to help support their education. Some fellowships include a tuition waiver or a payment to the university in lieu of tuition. Fellowships are a form of gift aid and do not have to be repaid.

Financial Aid
Money provided to the student and the family to help them pay for the student's education. Major forms of financial aid include gift aid (grants and scholarships) and self-help aid (loans and work).

Financial Aid Package
The complete collection of grants, scholarships, loans and work-study employment from all sources (federal, state, institutional and private) offered to a student to enable them to attend the college or university. Note that unsubsidized Stafford loans and PLUS loans are not considered part of the financial aid package, since these financing options are available to the family to help them meet the EFC.

First-Time Borrower
A first-year undergraduate student who has no unpaid loan balances outstanding on the date he or she signs a promissory note for an educational loan. For first-time borrowers, the first loan payment is disbursed 30 days after the first day of the enrollment period. If the student withdraws during the first 30 days of classes, the loan is canceled and does not need to be repaid.

Forbearance
During a forbearance the lender allows the borrower to temporarily postpone repaying the principal, but interest charges continue to accrue, even on subsidized loans. The borrower must continue paying interest charges during the forbearance period. Forbearances are granted at the lender's discretion, usually in cases of extreme financial hardship or other unusual circumstances when the borrower does not qualify for a deferment. Forbearance will not be granted if the loan is in default.

Free Application for Federal Student Aid (FAFSA)
Form used to apply for Pell Grants and all other need-based aid. As the name suggests, no fee is charged to file a FAFSA.

GPA Verification
A form required by the California Student Aid Commission if the student wishes to apply as a new recipient of California's Cal Grant A, or B programs. A high school or college official must provide GPA information when completing this form. The GPA Verification form should not be used to apply for a Cal Grant T award.

Grace Period
A short time period after graduation during which the borrower is not required to begin repaying his or her student loans. The grace period may also occur if the borrower leaves school for a reason other than graduation or drops below half-time enrollment. Depending on the type of loan, grace periods vary from six months (Stafford Loans) to nine months (Perkins Loans) before resuming payments. PLUS Loans do not have a grace period.

Guarantee Fee
A small percentage of the loan that is paid to the guarantee agency to insure the loan against default. The insurance fee is usually 1% of the loan amount (and by law cannot exceed 3% of the loan amount).

In-State Student
A student who has met the legal residency requirements for the state.

Independent
An independent student is at least 24 years old as of January 1 of the academic year, is married, is a graduate or professional student, has a legal dependent other than a spouse, is a veteran of the US Armed Forces, or is an orphan or ward of the court (or was a ward of the court until age 18). A parent refusing to provide support for their child's education is not sufficient for the child to be declared independent. (See also Dependent.)

Institutional Student Information Report (ISIR)
The electronic version of SARs delivered to schools by EDExpress.

Master Promissory Note (MPN)
A contract between the student and the lender promising to repay the loan and adhering to the terms and conditions of the loan.

Maturity Date
The date when a loan becomes due and must be repaid in full.

Merit-based
Financial aid that is merit-based depends on academic, artistic or athletic merit or some other criteria, and does not depend on the existence of financial need. Merit-based awards use grades, test scores, hobbies and special talents to determine eligibility for scholarships.

Need
The difference between the COA and the EFC is the student's financial need -- the gap between the cost of attending the school and the student's resources. The financial aid package is based on the amount of financial need. The process of determining a student's need is known as need analysis.

Need-Based
Financial aid that is need-based depends on the student's financial situation. Most government sources of financial aid are need-based.

Origination Fee
Fee paid to the bank to compensate them for the cost of administering the loan. The origination fees are charged as the loan is disbursed, and typically run to 3% of the amount disbursed. A portion of this fee is paid to federal government to offset the administrative costs of the loan.

Outside Scholarship
A scholarship that comes from sources other than the school and the federal or state government.

Out of State Student
A student who has not met the legal residency requirements for the state.

Parent Contribution (PC)
An estimate of the portion of educational expenses that the federal government believes the parents can afford. It is based on income, the number of parents earning income, assets, family size, the number of family members currently attending a university and other relevant factors. Students who qualify as independent are not expected to have a parent contribution.

Parent Loans for Undergraduate Students (PLUS)
Federal loans available to parents of dependent undergraduate students to help finance the child's education. Parents may borrow up to the full cost of their children's education, less the amount of any other financial aid received. PLUS Loans may be used to pay the EFC. There is a minimal credit check required for the PLUS loan, so a good credit history is required.

Pell Grant
A federal grant that provides funds based on the student's financial need.

Perkins Loan
Formerly the National Direct Student Loan Program, the Perkins Loan allows students to borrow up to $3,000/year (5 year max) for undergraduate school and $5,000/year for graduate school (6 year max). The Perkins Loan has a low interest rate and is awarded by the financial aid office to students with exceptional financial need. The student must have applied for a Pell Grant to be eligible. The interest on the Perkins Loan is subsidized while the student is in school.

Prepayment
Paying off all or part of a loan before it is due.

Principal
The amount of money borrowed or remaining unpaid on a loan. Interest is charged as a percentage of the principal. Insurance and origination fees will be deducted from this amount before disbursement.

Private Loans
Education loan programs established by private lenders to supplement the student and parent education loan programs available from federal and state governments.

Refund Check
A check granted when school charges for the term are less than the financial aid funds disbursed for the term.

Repayment Schedule
The repayment schedule discloses the monthly payment, interest rate, total repayment obligation, payment due dates and the term of the loan.

Sallie Mae
(Formerly known as SLMA or the Student Loan Marketing Association) The nation's largest secondary market and holds approximately one third of all educational loans.

Self Help Aid
Financial aid in the form of loans and student employment.

Stafford Loans
Federal loans that come in two forms, subsidized and unsubsidized. Subsidized loans are based on need; unsubsidized loans aren't. The interest on the subsidized Stafford Loan is paid by the federal government while the student is in school and during the 6 month grace period. The Subsidized Stafford Loan was formerly known as the Guaranteed Student Loan (GSL). The Unsubsidized Stafford Loan may be used to pay the EFC. Undergraduates may borrow up to $23,000 ($2,625 during the freshman year, $3,500 during the sophomore year and $5,500 during the third, fourth and fifth years) and graduate students up to $65,500 including any undergraduate Stafford loans ($8,500 per year). These limits are for subsidized and unsubsidized loans combined. The difference between the subsidized loan amount and the limit may be borrowed by the student as an unsubsidized loan.

Student Aid Report (SAR)
Report that summarizes the information included in the FAFSA and must be provided to your school's FAO. The SAR will also indicate the amount of Pell Grant eligibility, if any, and the Expected Family Contribution (EFC).

Student Contribution
The amount of money the federal government expects the student to contribute to his or her education and is included as part of the EFC. The SC depends on the student's income and assets.

Subsidized Loan
With a subsidized loan, such as the Perkins Loan or the Subsidized Stafford Loan, the government pays the interest on the loan while the student is in school, during the six-month grace period and during any deferment periods. Subsidized loans are awarded based on financial need and may not be used to finance the family contribution. See Stafford Loans for information about subsidized Stafford Loans. See also Unsubsidized Loan.

Supplemental Education Opportunity Grant
Federal grant program for undergraduate students with exceptional need. SEOG grants are awarded by the school's financial aid office.

Title IV Loans
Title IV of the Higher Education Act of 1965 created several education loan programs which are collectively referred to as the Federal Family Education Loan Program (FFELP). These loans, also called Title IV Loans, are the Federal Stafford Loans (Subsidized and Unsubsidized), Federal PLUS Loans and Federal Consolidation Loans.

Unsubsidized Loan
A loan for which the government does not pay the interest. The borrower is responsible for the interest on an unsubsidized loan from the date the loan is disbursed, even while the student is still in school. Students may avoid paying the interest while they are in school by capitalizing the interest, which increases the loan amount. Unsubsidized loans are not based on financial need and may be used to finance the family contribution. See Stafford Loans for information about unsubsidized Stafford Loans. See also Subsidized Loan.

US Department of Education (ED or USED)
Government agency that administers federal student financial aid programs, including the Federal Pell Grant, the Federal Work-Study Program, the Federal Perkins Loans, the Federal Stafford Loans and the Federal PLUS Loans.

Verification
Verification is a review process in which the FAO determines the accuracy of the information provided on the student's financial aid application. During the verification process the student and parent will be required to submit documentation for the amounts listed (or not listed) on the financial aid application

Veteran
For Federal financial aid purposes such as determining dependency status, a veteran is a former member of the US Armed Forces (Army, Navy, Air Force, Marines or Coast Guard) who served on active duty and was discharged other than dishonorably (i.e., received an honorable or medical discharge).

W2 Form
The form listing an employee's wages and tax withheld. Employers are required by the IRS to issue a W2 form for each employee before February 28.

Work Study
See Federal Work-Study.