Glossary of Financial Aid Terms
In an effort to help you and your family understand the terms and definitions related to your financial aid package, we’ve compiled a financial aid glossary of terms for easy reference. Our goal is to ensure that you get a clear sense of the process, from start to finish, so you know what to expect and can plan for the future.
Award Year:
School year for which financial aid is used to fund a student’s education. Generally, this is the 12-month period that begins on July 1 of one year and ends on June 30 of the following year.
Contributor:
Contributor is a new term introduced on the 2024-25 FAFSA form. It refers to anyone asked to provide information on a student’s FAFSA form:
- the student
- the student’s spouse
- a biological or adopted parent
- the parent’s spouse (stepparent).
A Contributor is NOT a grandparent, foster parents, legal guardian, brother or sister, aunt or uncle, even if they helped provide for or raise the student.
A Contributor on the FAFSA form doesn’t mean they are financially responsible for the student’s education costs.
Cost of Attendance (COA):
The estimated cost of attending this institution for one academic year per federal guidelines. The amount includes the following for one academic year (two semesters):
- Tuition – Charges assessed for classes
- Fees – Charges assessed for other college services
- Estimated living expense — allowance for rent, utilities, and food for off-campus living
- Estimated transportation costs
- Estimated books and supplies
- Miscellaneous costs
Course Program of Study (CPoS):
The U.S. Department of Education (ED) regulations require that a student must be enrolled in a degree-seeking program to receive federal financial aid (Grants, Loans, Work-Study). Funds will only be disbursed for the courses needed to fulfill the program of study requirements.
Credit Balance/Refund:
A student may receive a refund when a credit is remaining on their account after all tuition & fees, and room & board is paid for. A student may receive their refund electronically or by paper check. If a student chooses to receive their refund electronically, they must consent to receiving their refund through BankMobile. Through BankMobile Services, a technology solution powered by BMTX, Inc., the student may receive their refund by ACH using their existing bank account, to a BankMobile Vibe Account, or paper check (mailed to the mailing address on file). Refunds are issues from the Office of Treasury Services.
Default:
Failure to repay a loan according to the terms agreed to in the promissory note. For most federal student loans, you will default if you have not made a payment in more than 270 days. You may experience serious legal consequences if you default.
Dependent Student:
A student who does not meet any of the criteria for an independent student. An independent student is one of the following: at least 24 years old, married, a graduate or professional student, a veteran, a member of the armed forces, an orphan, a ward of the court, someone with legal dependents other than a spouse, an emancipated minor, or someone who is homeless or at risk of becoming homeless.
Direct Costs:
Expenses the student/family pays to the college.
Direct Data Exchange (DDX):
The system replacing the IRS Data Retrieval Tool (DRT) to transfer an individual’s FTI to the Department of Education. FA-DDX allows the Department to request, and the IRS to transfer, FTI to the FTIM system for use in determining a student’s federal financial aid eligibility.
Disbursement:
The release of loan funds to the school to pay towards the bill each semester. 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.
Enrollment Status:
Academic workload (or course load), as defined by the institution, that a student is carrying for a defined academic period. This normally relates to the number of credit hours or clock hours taken by a student during a given academic period. The PVAMU enrollment statusse are:
- Full-time status = at least 12 credit hours
- Three-quarter time status = at least 9-11 credit hours
- Half-time status = at least 6-8 credit hours.
- Less than Half-time status = 1-5 credit hours.
FAFSA:
The application for financial assistance from the federal government. In many states, the FAFSA is also used to determine eligibility for state aid.
Federal Direct Subsidized Loan:
A need-based student loan program designed to assist students with educational expenses while attending school at least half-time in an eligible program of study.
Federal Direct 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.
Federal Direct Graduate PLUS Loan:
A William D. Ford Federal Loan Program that allows qualified GRADUATE students to apply for up to the Cost of Attendance each year in a parent loan, less any financial aid. Graduate PLUS loans must be repaid with interest.
Federal Direct Parent PLUS Loan:
A William D. Ford Federal Loan Program that allows qualified parents to apply for up to the Cost of Attendance each year in a parent loan, less any financial aid. PLUS loans must be repaid with interest.
Financial Aid Offer Notification:
An aid offer, may be tentative at first, including various known types and amounts of financial aid you may receive from federal, state, private, and/or school sources based on current information. This combination of aid is your financial aid package.
FSA ID:
Your Federal Student Aid ID is the username and password you use when you visit certain U.S. Department of Education websites. The FSA ID is used to sign legally binding documents electronically.
Grants:
Gift aid awarded to the student that does not need to be repaid. Grants are typically based on financial need.
Independent Student:
An independent student is one of the following: at least 24 years old, married, a graduate or professional student, a veteran, a member of the armed forces, an orphan, a ward of the court, or someone with legal dependents other than a spouse, an emancipated minor or someone who is homeless or at risk of becoming homeless.
Indirect Cost:
Expenses incurred as a result of attendance that the student/family may pay to a third party (rent, landlord, etc.) other than the college.
Lender:
A bank, credit union, savings and loan association, or other financial institution that provides funds to the student or parent for an educational loan.
Master Promissory Note (MPN):
The document you must sign prior to obtaining a student loan. The MPN will outline the terms of the loan including the interest rate, loan period, repayment guidelines, and much more. Students must complete the MPN for any Direct Subsidized, Unsubsidized, or Perkins loans they accept.
Need Based:
Based on a student’s financial need as determined by the FAFSA. For example, a need-based grant might be awarded based on a student’s low income.
Net Price:
An estimate of the actual cost that a student and their family need to pay in a given year to cover education expenses for the student to attend a particular school. Net price is determined by taking the institution’s cost of attendance and subtracting any grants and scholarships for which the student may be eligible.
Overawards:
A financial aid award made to a student in excess of their demonstrated financial need. A student may not receive a total financial aid award package in excess of the total cost of attendance.
Pell Grant:
A grant provided by the federal government to qualified undergraduate students who demonstrate exceptional financial need and have an Student Aid Index (SAI), or formerly known and the Expected Family Contribution (EFC), below a threshold designated annually by the U.S. Department of Education, based on the amount of program funds appropriated by Congress.
Private Loan:
Educational loans issued by an organization other than the federal government or the institution.
Professional Judgment (PJ):
The delegation of authority from the federal government to the financial aid administrator (FAA). For need-based federal, state, and institutional aid programs, the federal government may delegate authority to the FAA who can adjust the SAI/EFC, adjust the COA, or change the dependency status (with documentation) when extenuating circumstances exist. For example, if a parent becomes unemployed, disabled, or deceased, the FAA can decide to use estimated income information for the award year instead of the actual income figures from the base year.
Room and Board:
An allowance for the cost of housing and food while attending college or career school.
Return to Title IV (R2T4):
Federal regulations require PVAMU to perform a refund calculation for unearned aid on all students who withdraw on or prior to 60% of the payment period (semester/term) and received Federal Title IV funds. Click here for more information.
Satisfactory Academic Progress:
All undergraduate students receiving financial aid must continue to maintain certain standards of academic progress to continue receiving the aid. Students receiving aid through federal sources, including the Federal Parent PLUS Loan, must maintain at least a 2.0 minimum cumulative GPA and earn at least 67% of attempted credits. Specific information by type of aid program is available on the Satisfactory Academic Progress (SAP) requirements page.
Scholarships:
Financial aid that does not have to be repaid. Scholarships may be need-based, talent-based or award for a student’s academic achievement. Criteria for scholarship eligibility varies widely, and students should check with the organization issuing a scholarship to determine if certain criteria must be met in order to maintain eligibility. Visit our Scholarship website for a list of PVAMU scholarships.
SEOG Grant:
A grant provided by the federal government to qualified undergraduate students who demonstrate exceptional financial need. Priority is given to Pell Grant recipients and funds must be awarded by the school in lowest SAI/EFC order.
Special Circumstances:
Special or extenuating situations (such as a job loss) that impact a student’s financial condition and support a financial aid administrator adjusting a data element in the COA or in the SAI calculation on a case-by-case basis.
Student Aid Index (formerly EFC):
The Student Aid Index (SAI) is an eligibility index number that a college’s or career school’s financial aid office uses to determine how much federal student aid the student would receive if the student attended the school.
Tax Return Transcript:
The official receipt of tax return processing from the IRS. A transcript is available based on calendar year.
Third Party Scholarships:
Also known as “outside scholarships,” third-party college scholarships can help fill the financial gap if some or all of your academic tuition isn’t covered by federal aid. Unlike student loans, they’re a form of financial aid that doesn’t require repayment.
Unusual Circumstances:
Conditions that justify a financial aid administrator making an adjustment to a student’s dependency status, commonly referred to as a dependency override, based on an unusual situation (human trafficking or parental abandonment).
Verification:
The process the federal government uses to confirm that the data reported on your FAFSA is accurate. If you are selected for verification, PVAMU is required to collect additional documentation from you and complete the verification review prior to disbursing any funds to your student account.
Work- Study:
A program that provides part-time employment to students attending institutions of higher education who need the earnings to help meet their costs of postsecondary education and encourages students receiving FWS assistance to participate in community service activities.