Paying For Higher Education Quiz

Work Study

A federal program that provides part time employment opportunities for students with financial need, allowing them to earn money to help pay educational expenses

Subsidized Loan

A need-based loan from the federal government, the interest of which is paid for by the U.S. Department of Education while the borrower is in school and during grace and deferment periods.

Unsubsidized Loan

A non-need based loan from the federal government, the interest of which is paid for by the borrower

Student Aid Report

A report that summarizes responses made when completing the FAFSA form

Describe the difference between a subsidized and an unsubsidized loan.

A subsidized loan: the interest is paid by federal government while you are in school and for 6 months after you leave school. It is need based. Unsubsidized loan: the interest accumulate (accrue) while student is in school and after leaving school, the borrower will pay all of the interest. (not need based)

Grant

A tax-exempt financial aid that may be given for many purposes, not necessarily just for education.

Accrue

Accumulate

Who offers private loans and why should they typically be the last financial aid option considered?

Banks, Credit Unions, or Universities should be your last option because they are the most expensive option.

Loan Servicer

Company that collects payment on a loan

COA

Cost of attendance

Expected Family Contribution

EFC, the amount of money you and your family are expected to pay

Loan Default

Failure to pay a loan according to the agreed upon terms.

FAFSA

Free application for federal student aid - Application that must be completed to determine financial aid

Scolarship

Money awarded to students that does not have to be repaid and is based on academic or other achievements.

Grace Period

Period of time after a borrower graduates, leaves School or drops below half-time enrollment where they are not required to make certain federal loan payments

Deferment

Postponement of payment on a loan allowed under certain conditions when interest does not accrue.

List and describe two sources of financial aid you do not need to pay back.

Scholarships: money awarded to students based on academic or other achievements to help pay for education. Grants: tax-exempt financial aid that may be given for many purposes, not necessarily just for education.

Forbearance

Stop or reduce loan payments for a short period of time while interest still accruing

Net Price

The cost of attendance minus grants and Scholarships

Financial Need

The difference between the cost of attending a particular school and the expected family contribution.

Consolidate

To combine into a single overall account or set of accounts