Financial Aid Terms

Lost in financial aid terminology? Learn the terms and definitions involving financial aid.

Borrower-Based Academic Year (BBAY)
An academic year that consists of any two consecutive semesters such as spring-summer,  summer-fall. This is typical for graduate students.

Cost of Attendance (COA)
The estimated total cost of attending an institution for one academic year. This amount includes tuition, housing, meal plans, fees, textbooks, transportation, parking, etc.

Deferment
A temporary pause to loan payments for specific situations. If you have a subsidized loan, interest generally doesn’t accrue during this time. If you have an unsubsidized loan, you are responsible for the interest during deferment.

Dependent Status
A dependent student is assumed to have financial support from their family. When calculating the student’s expected family contribution, the FAFSA factors in their parents’ financial information. Dependence does not mean the same thing for the FAFSA as it does for IRS tax returns. While a student might not be a dependent for tax purposes, they could still count as dependent for financial aid purposes.

Entrance Counseling
Entrance counseling explains your rights and the obligations you agree to meet as a condition of accepting a federal student loan. More information about entrance counseling is available at: https://studentaid.gov/entrance-counseling. 

Exit Counseling
Exit counseling provides important information to prepare you to repay your federal student loan. More information about exit counseling is available at: https://studentaid.gov/exit-counseling.

Expected Family Contribution (EFC)
This is the number that’s used to determine your eligibility for federal student financial aid. This number results from the financial information you provide in your FAFSA. Your EFC is reported to you on your Student Aid Report.

Federal Direct Grad PLUS loan
Loan provided by the federal government that allows graduate students with no adverse credit history to apply for a loan amount up to their Cost of Attendance each year, less any other financial aid received.

Federal Direct Parent PLUS loan
Loan provided by the federal government that is available to parents of dependent, undergraduate students to help pay for college.  This federal loan program allows parents with no adverse credit history to apply for a loan amount up to the Cost of Attendance each year, less any financial aid received by the dependent student. Repayment of principal and interest begins immediately once the loan is fully disbursed with some options to delay payment available.

Federal Direct Subsidized Student Loan
Federal loan awarded on the basis of financial need. The federal government pays the interest on the loan until you begin repayment. The student must submit a Master Promissory Note (MPN) and complete online entrance counseling before funds are disbursed. 

Federal Direct Unsubsidized Student Loan
Federal loan awarded to undergraduate and graduate students regardless of their financial need. It offers students a low, fixed interest rate and flexible repayment terms. Interest accrual begins immediately, and the student can choose to pay the interest while enrolled or upon entering repayment. 

Federal Pell Grant 
A federal grant provided by the federal government to undergraduate students who demonstrate the largest financial need and have an Expected Family Contribution below a certain threshold established by the federal government. 

Federal Student Aid
Aid from the government in the form of grants, loans, and/or work-study to assist students with college or career school. A FAFSA is required to receive this aid.

Federal Supplemental Educational Opportunity Grant (FSEOG)
An undergraduate federal grant awarded to students with exceptional financial need. Federal Pell Grant Recipients will receive FSEOGs first.

Federal Work Study (FWS)
Provides funds for part-time employment to help needy students finance the cost of post secondary education. Funds are limited. The FWS award amount will not automatically be posted as a credit on a student account. This is an award amount that a student may earn as a monthly paycheck through the FWS program.

Financial Aid
Money to help pay for college or career school

Financial Aid Package
The Financial Aid Package informs the student what financial aid they can receive at a particular school. The Financial Aid Office combines various forms of aid into the package to help meet the student’s educational needs.

Free Application for Federal Student Aid (FAFSA)
The FAFSA is the free application used to determine eligibility for federal student grants, federal work study and federal loans.

FSA ID
An FSA ID consists of the account username and password that give you access to the U.S. Department of Education’s online systems and can serve as your legal signature when completing electronic documents.

Graduate Student
A student who is pursuing education opportunities (master’s and doctoral programs) beyond an undergraduate degree

Grant
A monetary gift for people pursuing higher education. It is often based on financial need and does not need to be repaid (unless you withdraw from school and owe a refund).

Interest
Interest is the price you pay to borrow money and is paid by a borrower to a lender. You can find your federal student loan interest rate by logging in to StudentAid.gov and reviewing your Aid Summary page.

Iraq and Afghanistan Service Grant (IASG)
A Title IV grant for dependents of soldiers who died as a result of service in the U.S. military in Iraq or Afghanistan after 9/11. You are not eligible for a Federal Pell Grant.

Independent Status
You qualify as an independent student if you are 24 years or older; married; a graduate/ professional student; a veteran; a member of the armed forces; an orphan; a ward of the court; someone with legal dependents (not a spouse); an emancipated minor; or someone who is or at risk of being homeless. Their FAFSA will not use their parents’ financial information to calculate the student’s expected family contribution.

Lipscomb Memorial
Memorial is the inclusive term for need-based aid at Lipscomb. Memorials are of two types: general and designated. A general memorial comes from the general funds of the university. The designated memorials consist of restricted scholarship funds set up in memory of individuals. 

Loan
Money borrowed from the federal government or a private source (bank or financial institution) and must be paid back with interest

Master Promissory Note (MPN)
A legal document in which you promise to repay the loan and any accrued interest and fees to the U.S. Department of Education. It contains the Borrower’s Rights and Responsibilities and Terms and Conditions for repayment. 

Merit-based
Merit-based means that something is based on a student's skill or ability. For example, a merit-based scholarship might be awarded based on a student's high grades.

Net price
The estimated amount a student will pay to attend college in a single academic year after subtracting scholarships, grants and other aid that the student does not need to repay. It does not factor in loans.

Net Price Calculator
A tool that allows current and prospective students / families to estimate the net price of attending a particular college.

Private Loan
A student or parent loan from a bank, credit union or online lender used to pay for college expenses. Private loans have varying interest rates, fees and repayment options and usually require the applicant to be creditworthy, or have a creditworthy cosigner. 

Repayment
The act of paying back money you previous borrowed from a lender

Satisfactory Academic Progress (SAP)
The process a school uses to determine if a student is meeting all of his or her educational requirements and is on target to graduate on time with a degree or certificate.

Scholarship
A grant or payment made to support a student’s education, awarded on the basis of academic or other achievement, that does not need to be repaid. They can be a one-time gift or are renewable.

Standard Academic Year (SAY)
A standard academic year is 30 weeks (roughly 9 months) of instructional time that goes from Fall-Spring. Summer is considered a trailing semester, meaning summer is the end of the academic year.

Student Aid Report (SAR)
A report that summarizes the information included in the FAFSA and gives you basic information about your eligibility for federal student aid, including the Expected Family Contribution (EFC)

Tennessee HOPE Scholarship
Funded from the net proceeds of the state lottery and are awarded to entering freshmen and returning students who are Tennessee residents and meet eligibility requirements as specified by the Tennessee state legislature

Tennessee Student Assistance Award (TSAA)
A state-funded grant program that provides non-repayable financial aid to needy undergraduate students who are Tennessee residents

Teacher Education Assistance for College and Higher Education (TEACH)
Federal grants for undergraduate and graduate students who are completing coursework that is required to be a teacher, and who agree to teach full-time in a high-need field at an educational service agency or school for low-income students for at least four years

Verification
A federally mandated process to confirm the accuracy of data provided on the student’s financial aid application (FAFSA). The student and parent will be required to submit certain documentation for review. The verification result can change the student's financial aid eligibility or financial aid offers if the data submitted was inaccurate.