Academic Year
The period during which school is in session. For example, an institution's academic year may consist of a fall and spring semester. The 2022/2023 academic year at Commonwealth University - Mansfield begins August 22, 2022 and ends May 11, 2023.
Bankruptcy
A legal action in which a person who is unable to meet the financial obligations is declared bankrupt by a decree of the court under Federal Bankruptcy Law. Federal student loans, however, cannot normally be discharged through bankruptcy.
Capitalization
The process of adding unpaid interest to the principal balance of a loan, rather than pay the interest when it is due. If the interest is capitalized it will increase the amount of the monthly payment during the repayment period. This applies to the unsubsidized Stafford loan and most private loans.
Consolidation
A loan program that enables a borrower to combine various loans with various interest rates or various lenders into a single loan with a more manageable repayment schedule. The repayment period is also extended.
Cost of Attendance
The total amount it will cost a student to attend a particular school. The cost of attendance usually includes direct costs (tuition, fees) and indirect costs (books and supplies). Financial aid resources cannot exceed the institution's established cost of attendance.
Default
Failure to repay a loan according to the terms agreed to when the student signed a promissory note. Default also may result from failure to submit requests for deferment or cancellation on time. The consequences of default are severe. The holder of your loan will likely take action to recover the money. The holder of your loan may report you to a credit agency, your wages may be garnished, and you may be liable for expenses incurred in collecting the loan. The U.S. Department of Education may ask the Internal Revenue Service to withhold your income tax refund and apply it toward the amount you owe.
Deferment
Postponement of repayment that must be requested by the student and formally approved by the lender. Deferments can in some cases be granted for economic hardship or further study.
Disbursement
The release of loan funds. In most cases loans are disbursed in two equal installments.
Electronic Funds Transfer (EFT)
Method where funds that the student applied for are electronically transferred from the lender into the student's tuition account at the Office of the Bursar.
Expected Family Contribution (EFC)
The EFC is calculated using a needs analysis formula developed by Congressional Methodology, using information reported on the FAFSA. The figure is the total amount the student and family are expected to contribute to the student's education for the academic year. This figure is used to determine the student's eligibility for financial aid. The EFC is printed on the front page, top right hand corner of the Student Aid Report (SAR). Aslo referred to as a Student Aid Index.
FAFSA (Free Application for Federal Student Aid)
The application for all federal financial aid. This form, developed by Congress, has to be completed each academic year by the student, in order to be eligible to receive financial aid.
Federal School Code
Commonwealth University - Mansfield's school code is 003324. This code must be included when completing a FAFSA.
Financial Aid Package
Federal and non-federal aid such as grants, loans, work study, and outside resources are combined in a "package" or a notice of eligibility communicated to a student to help meet the student's financial need.
Financial Need
The difference between the Cost of Attendance and the Estimated Family Contribution.
Forbearance
An arrangement whereby the lender may permit the temporary cessation of payments (principal and/or interest), or allow an extension of time for making payments, or accept smaller payments than were previously scheduled. Interest will accrue during forbearance.
Grace Period
The period between the time a borrower leaves school or, if in school, drops below half-time and the time he/she is obligated to begin repaying their loans. Depending on the type of loan, this is usually six or nine months.
Grant
Type of award that does not need to be repaid. The award is based on merit and/or need.
Interest
A fee charged to the borrower for the privilege of using the lender's money. Interest is calculated as a percentage of the principal balance of the loan. The rate may be fixed (constant throughout the life of the loan) or variable (may change at specified times).
Institutional Student Information Record (ISIR)
The name for the electronic version of a Student Aid Report submitted to schools by the FAFSA processor.
Lender
A financial institution that provides the funds for students to borrow in the form of educational loans.
Loan
Type of financial aid that must be repaid, generally interest bearing.
Master Promissory Note (MPN)
A promissory note is the legal agreement a student signs with a lender accepting student loan funds. The MPN states the terms and conditions of the loan, including a repayment schedule, interest rate, deferment policy, and cancellation policy. The MPN is a simplified form used to complete the Federal Direct Loan process.
Need-Based Financial Aid
Financial aid that relies upon need as the criterion for eligibility. Need is determined by subtracting the Expected Family Contribution (EFC), via the FAFSA, from the student's established Cost of Attendance determined by the educational institution.
Non Need-Based Financial Aid
Financial aid that does not require need as a criterion for eligibility.
Origination Fee
A fee charged by the lender for administration of some student loans. This fee is deducted from the loan prior to disbursement. Origination fees are charged as the loan is disbursed.
Principal
The amount of money borrowed, excluding interest.
Repayment Schedule
Discloses the borrower's total repayment obligation: monthly payment, interest rate, due dates, and length of time for repaying the loan.
Student Aid Report (SAR)
Information provided to a student after submitting the FAFSA to the federal processor.
Satisfactory Academic Progress (SAP)
The academic progress standards are established by the institution and are required by the federal government. Students must meet these standards each year in order to receive financial aid funds.
Subsidized Loan
Students who demonstrate financial need are eligible for a subsidized loan. No interest accrues on the loan while the borrower is in school at least half time.
Unsubsidized Loan
Students who do not demonstrate financial need are eligible for an unsubsidized loan. Unsubsidized Federal Direct loans start accumulating interest from the day the money is disbursed. The interest may be capitalized as long as the student is attending school at least half-time.
Verification
A federal aid review process established by the Department of Education to confirm the accuracy of data submitted by the student to FAFSA. The Office of Financial Aid will communicate to students if they are selected for federal verification and provide instructions on how to complete the process online.