Glossary of College Financial Aid Terms

At College Money Pros, we believe in educating our clients to make informed decisions, based on factual and verifiable information. Often there are terms related to college planning and financial aid that are not clearly understood by the general public.

Many of our clients often ask us what things mean regarding college financial aid and planning. Here’s a list of the most often asked words or terms for your convenience. We are here to make parents feel confident that their student has an attainable plan to get into a college program of your choice comfortably.

Academic Adviser: This is a senior faculty member in your area of concentration who is assigned to advise you on course selections and requirements. Before you declare your major, you will be assigned a temporary faculty adviser.

Accelerated Study: This program allows you to graduate in less time than is usually required. For instance, by taking summer terms and extra courses during the academic year, you could finish a bachelor’s degree in three years instead of four.

Acceptance Form: This form documents the student’s receipt of an award letter. The form usually includes a space to indicate acceptance of offered aid, declination of all or part of the package, and some means for requesting an appeal to modify the award. Acceptance letters and award letters are frequently combined into a single document.

Admissions Decisions:

Admit: You’re in! You are being offered admissions to the college to which you applied. Your high school will receive notification, too.

Admit/Deny: You have been admitted but denied any financial aid. It is up to you to figure out how you are going to pay for school.

Deny: You are not in. The decision is made by the college or university admissions committee and is forwarded to you and your high school.

Wait List: You are not in yet but have been placed on a waiting list in case and opening becomes available. Schools rank their wait list in order of priority, and unfortunately, the more competitive schools have years when they never draw from their wait lists. After a certain time, a rejection notice is sent.


Advanced Placement: High-level, quality courses in any of twenty subjects. The program is administered through the College Board to offer high school course descriptions equated to college courses and correlated to AP examinations in those subjects. High schools provide the courses as part of their curriculum to eligible students. Based on the composite score on an AP test, which ranges from 0 to 5, a college may award college credit or advanced placement to a participating student. A score of a 4 or 5 on the AP test is usually required by colleges for credit or advanced placement in college courses. A 3 is sometimes acceptable in foreign languages and some other subject areas. Some colleges limit the number of AP credits that they will recognize. Check schools’ policies on AP credits.

Alternative Assessment: This method personalizes the admissions process and offers students an opportunity to be viewed more individually and holistically. Less emphasis is placed on standardized test scores and more on the interview, portfolio, recommendations, and essay.


American College Testing (ACT) Program Assessment: An alternative to the SAT, this test has gained wide acceptance by a broad range of institutions in recent years and is given during the school year at test centers. The ACT tests English, mathematics, reading, and science reasoning. These subject test scores can be used in lieu of SAT II subject tests, which are required for admission to some of the more competitive colleges. The score is the average of all four tests; the maximum score is 36.

Aptitudes: Aptitudes are natural talents, special abilities for doing, or learning to do, certain kinds of things. Manual dexterity, musical ability, spatial visualization, and memory for numbers are examples of such aptitudes.

Asset Protection Allowance: A sum subtracted from a family’s total assets when determining the Expected Family Contribution to college costs. This allowance provides a safety net for families. The allowance increases with the age of the parents. The allowance is roughly one thousand times the oldest parent’s age.

Assets: The amount a family has in non-retirement savings and investments. This includes savings and checking accounts; a business; a farm or other real estate; and stocks, bonds, and trust funds. Cars are not considered assets, nor are such possessions as stamp collections or jewelry. The net value of the principal home is counted as an asset by some colleges in determining their own awards but is not included in the calculation for eligibility for federal funds.

Award Letter: An award letter is an official document issued by the Financial Aid Office that lists all of the financial aid awarded to the student. This letter provides details on their analysis of the student’s financial need and the breakdown of the financial aid package according to amount, source, and type of aid. The award letter will include the terms and conditions for the financial aid and information about the Cost of Attendance.

Bachelor’s or Baccalaureate Degree: The degree received after the satisfactory completion of a full-time program of study or its part-time equivalent at a college or university. The Bachelor of Arts (B.A) and the Bachelor of Science (B.S.) are the most common baccalaureates.

Base Year: Colleges determine your Expected Family Contribution by looking at your income and assets for the twelve-month period, ending on December 31, preceding the school year for which you are seeking financial aid. That year is called the “base year.” For example, if your child is applying for financial aid for the 2006-2007 school year the school will use the calendar year 2005 as the base year to determine your Expected Family Contribution.


Branch Campus: A campus connected to, or part of, a large institution. Generally, a student spends the first two years at a branch campus and then transfers to the main campus to complete the baccalaureate degree. A branch campus provides a smaller and more persona environment that may help a student mature personally and academically before moving to a larger and more impersonal environment. A branch campus experience may be a good idea for a student who wants to remain close to home or for an adult learner who wishes to work and attend college classes on a part-time basis.

Business Farm Supplement: An additional financial aid form required by some colleges for parents and students who own a business or farm. This form is processed by the College Scholarship Service and is a supplement to the Financial Aid Profile.

Campus-based Programs: The term commonly applied to those U.S. Department of Education federal student aid programs administered directly by institutions of postsecondary education. Includes: Federal Perkins Loan, Federal Supplemental Educational Opportunity Grant (FSEOG), and Federal Work-Study (FWS) programs.

Candidates Reply Date Agreement (CRDA): If admitted to a college, a student does not have to reply until May 1. This allows time to hear from all the colleges to which the student applied before having to make a commitment to any of them. This is especially important because financial aid packages vary from one school to another, and the CRDA allows time to compare packages before deciding.

College Board: A nonprofit membership organization comprised of colleges, secondary schools, and educational associations that administers the SATs and runs the College Scholarship Service.

Colleges: Colleges are smaller schools that offer a wide variety of programs which usually take a shorter time to complete. Colleges are very similar to universities in that they also offer a large number of programs, however they typically do not have as many students and do not grant degrees. Instead of giving degrees a college typically grants diplomas or certificates.
 Some colleges also offer what are called university transfer programs, which allow you to start a program at a college and then transfer to a university to finish your degree. Most colleges and universities publish transfer guides that tell you which programs can be transferred to which schools. For more information on transfer programs, contact an advisor or talk to your high school counselor.
 Upon completion a program, the school may help you find a job relating to your field of study. Some programs also lead into apprenticeships, where you continue your education by working for an experience professional in the field. Talk to your high school counselor or career center for more information about apprenticeships and trade schools.


College-Preparatory Subjects: Courses taken in high school that are viewed by colleges and universities as a strong preparation for college work. The specific courses are usually in the five majors area of English, history, world languages, mathematics, and science. The courses may be regular, honors-level, or AP offerings, and the latter two categories are often weighted when calculated in the GPA.


College Scholarship Service (CSS): When the federal government changed the FAFSA form several years ago, the College Board created this program to assist post-secondary institutions, state scholarship programs, and other organizations in measuring a family’s financial strength and analyzing its ability to contribute to college costs. CSS processes the PROFILE financial form that students may use to apply for non-federal aid. This form is submitted to some 300 private colleges and universities along with the FAFSA when seeking financial aid from these institutions. Participating colleges and universities indicate whether they require this form.


Common and Universal Applications: These college application forms can save students hours of work. The Common Application is presently accepted by about 190 independent colleges, while the Universal is used by about 1,000 schools. The colleges and universities that accept these standardized forms give them equal weight with their own application forms. Students complete the information on the standardized form and then submit it to any of the schools listed as accepting it. Some schools will return a supplementary form to be completed by the applicant, but most schools base their decisions on these documents alone. The Common Application is available on disk or as a hard copy and can be obtained from your guidance department. The Universal Application is available on the Web.


Commuter Student: A student who does not live on campus; typically ‘commuter’ refers to a student living at home with his or her parents, but can also mean any student who lives off-campus.

Control: A college or university can be under public or private control. Publicly controlled universities are dependent on state legislatures for their funding, and their policies are set by the agencies that govern them. Private colleges and universities are responsible to a board of directors or trustees. They usually have higher tuition and fees to protect the institutions’ endowment.


Cooperative Education: In a cooperative education program, the student spends some time engaged in employment related to their major in addition to regular classroom study.

Cost of Education: This includes tuition and fees, room and board, books and supplies, transportation, and miscellaneous expenses. A student’s financial aid eligibility is the difference between the cost of education and the Expected Family Contribution as computed by the federal government using the FAFSA.


Course Load: The number of course credit hours a student takes in each semester. Twelve credit hours is the minimum to be considered a full-time student. The average course load per semester is 16 credit hours.

Credit Hour: The unit of measurement some institutions give for fulfilling course requirements. A credit in a school or college, usually representing one hour of class per week for one term.

Cross-Registration: The practice, through agreements between colleges, of permitting students enrolled at one college or university to enroll in courses at another institution without formally applying for admission to the second institution. This can be an advantage for students in a smaller college who might like to expand options or experience another learning environment.

Deferred Acceptance: The admissions decision is being moved to a later date.


Dental School: A graduate school offering study leading to degrees in dentistry.


Distance Education: If you do not want to attend a school in person or if you do not live near an institution, it is still possible for you to complete a program. Many universities and colleges offer distance education programs, which allow you to study through correspondence. Some universities are even beginning to offer distance education programs through the internet using the Web and E-mail. If you are interested in a distance education program, contact the school’s admissions or distance education office for details.

Double Major: Available at most schools, the double major allows a student to complete all the requirements to simultaneously earn a major in two fields.


Dual Enrollment: This policy allows a student to earn college credit while still in high school. Many of these course credits can be transferred to a degree-granting institution, especially if the student maintains a minimum B average. A college, however, may disallow courses taken in the major field of concentration at another institution because its policy dictates that all courses in the major must be taken at the college. When considering dual enrollment, students should talk with admissions offices at the colleges they are considering enrolling in to make sure that they will accept credit transfers.


Early Action: An early action program has earlier deadlines and earlier notification dates than the regular admissions process. Unlike the Early Decision program, the early action program does not require that a student commit to attending the school if admitted.


Early Admission: Procedure used by colleges which allows gifted high-school juniors to skip their senior year and enroll instead in college. The term “Early Admission” is sometimes used to refer collectively to Early Action and Early Decision programs.


Early Decision: Some colleges offer the option of an early decision to students who meet all entrance requirements, are certain of the college they wish to attend, and are likely to be accepted by that college. Students participate in the Early Decision plan by indicating their desire to participate on their college application. The decision regarding admission is made by mid-December of the student’s senior year in high school, as opposed to the regular admissions notification of mid-April. A drawback of the Early Decision program is that students will have to commit to a school before they find out about the financial aid packet. A student can apply early decision to only one school.

Emphasis: An area of concentration within a major or minor; for example, an English major may have an emphasis in creative writing.


Expected Family Contribution (EFC): The amount of financial support a family is expected to contribute toward a child’s college education. This amount is part of the formula used by the federal government to determine financial aid eligibility using the FAFSA form.


External Degree Program: A program of study whereby a student can earn credit through independent study, college courses, proficiency examinations, distance learning, or personal experience. External degree colleges generally have no campus or classroom facilities. They are sometimes referred to as “colleges without walls.”

Federal Pell Grant Program: This is a federally sponsored and administered program that provides grants based on need to undergraduate students. Congress annually sets the appropriation; amounts range from $400 to $3,000 annually. This is “free” money because it does not need to be repaid.


Federal Perkins Loan Program: This is a federally run program based on need and administered by a college’s financial aid office. This program offers low-interest loans for undergraduate study. Repayment does not begin until a student graduates. The maximum loan amount is $3,000 per year.


Federal Stafford Loan: Another federal program based on need that allows a student to borrow money for educational expenses directly from banks and other lending institutions (sometimes from the colleges themselves). These loans may be either subsidized or unsubsidized. Repayment begins six months after a student’s course load drops to less than halftime. Currently the interest rate is 0 percent while in school and then is variable up to 8.25 percent. The loan must be repaid within ten years.


Federal Work-Study Program (FSW): A federally financed program that arranges for students to combine employment and college study; the employment may be an integral part of the academic program (as in cooperative education or internships) or simply a means of paying for college.


Full Time Employee: Is any employee who works for at least 40 hours per week.

Full Time Student: Is any student who is enrolled for at least 3 Classes (maybe 4 classes depending on the university) per semester.

Gap: The difference between the amount of a financial aid package and the cost of attending a college or university. The student and his/her family are expected to fill the gap.


Grants/Scholarships: These are financial awards that are usually dispensed by the financial aid offices of colleges and universities. The awards may be need- or merit-based. Most are need-based. Merit-based awards may be awarded on the basis of excellence in academics, leadership, volunteerism, athletic ability, or special talent.


Graduate School: A school in a university offering study leading to degrees beyond the bachelor’s degree.

Honors Program: Honors programs offer an enriched, top-quality educational experience that often includes small class size, custom-designed courses, mentoring, enriched individualized learning, hands-on research, and publishing opportunities. A handpicked faculty guides students through the program. Honors programs are a great way to attend a large school that offers enhanced social and recreational opportunities while receiving an Ivy League-like education at a reduced cost.


Independent Study: This option allows students to complete some of their credit requirements by studying on their own. A student and his or her faculty adviser agree in advance on the topic and approach of the study program and meet periodically to discuss the student’s progress. A final report is handed in for a grade at the end of the term.


Interdisciplinary: Faculty members from several disciplines contribute to the development of the course of study and may co-teach the course.


Internship: This is an experience-based opportunity, most often scheduled during breaks in the academic calendar, whereby a student receives credit for a supervised work experience related to his or her major.


Law School: A graduate school offering study leading to a law degree.

Major: The concentration of a number of credit hours in a specific subject. Colleges and universities often specify the number of credits needed to receive a major, the sequence of courses, and the level of course necessary to complete the requirements.


Medical School: A graduate school offering study leading to a medical degree.
Merit Awards,

Merit-Based Scholarships: These awards are based on excellence in academics, leadership, volunteerism, athletic ability, and other areas determined by the granting organization, which can be a college or university, an organization, or an individual. They are not based on financial need.


Minor: An area of concentration with fewer credits than a major. The minor can be related to the major area of concentration or not; for example, an English major may have a minor in theater.

Need Blind: Admissions decisions made without reference to a student’s financial aid request, that is, an applicant’s financial need is not known to the committee at the time of decision.


Non-matriculated: A student who has either not been admitted yet but is taking classes or has been academically dismissed. Under this category, a student may neither receive financial aid nor participate in an athletic program at that school.


Normal School: School for the professional training of teachers, especially elementary school teachers.


Open Admissions: Students are admitted regardless of academic qualifications. The school may require an additional probationary period during which the student must earn satisfactory grades to ensure continued enrollment. This is the same as Open Enrollment.


Open Enrollment: Policy of admitting any high school graduate to college in an effort to provide higher education for all who desire it. To critics this means lowering of standards, since considerable effort must be devoted to teaching basic skills. The most ambitious programs were established in California and New York City. In the 1980s many educational institutions partially reversed such policies and increased admission requirements. This is the same as Open Admission.


Out-of-State Student: This term generally applies to students applying to a public college or university. Tuition rates are lower for state residents; out-of-state students must pay a higher rate of tuition until they have established the legal residency requirements for the state.


Part Time Student is any student who is enrolled for at least 1 Class per semester and no more than 2 classes per semester.
Part Time Employee is any employee who works for at least 1 hour per week but less than 40 hours per week.

Preliminary Scholastic Assessment Test (PSAT)/National Merit Scholarship Qualifying Test: This test, given in October, duplicates the kinds of questions asked on the SAT but is shorter and takes less time. Usually taken in the junior year, the test also acts as a qualifying instrument for the National Merit Scholarship Awards Program and is helpful for early college guidance.


Remediation: Students who are not fully prepared for college academically are often required to complete remedial classes. The courses are designed to bring the student up to the level required for satisfactory college-level performances. Such courses are usually not granted credit towards graduation.

Reserve Officers’ Training Corps (ROTC): Each branch of the military sponsors an ROTC program. In exchange for a certain number of years on active duty, students can have their college education paid for up to a certain amount by the armed forces.


Residency Requirements: The term has more than one meaning. It can refer to the fact that a college may require a specific number of course to be taken on campus to receive a degree from the school, or the phrase can mean the time, by law, that is required for a person to reside in the state to be considered eligible for in-state tuition at one of its public colleges or universities.


Retention Rate: The number and percentage of students returning for the sophomore year.


Rolling Admissions: Students’ applications are considered when all required credentials have been submitted. There is either no deadline or a very late deadline; qualified students are accepted until classes are filled. Applicants are notified of admission continuously throughout the enrollment period.

Scholastic Assessment Test (SAT) I: Also known as “board scores” because the test was developed by the College Board. This test concentrates on verbal and mathematical reasoning abilities and is given throughout the academic year at test centers. The maximum combined score for both sections is 1600.

SAT II Subject Tests: These subject-specific exams are given on the same test dates and in the same centers as the SAT I. More emphasis has been placed on these tests in recent years, not only because they are used for admission purposes, but also for placement and exemption decisions.


Selective Admissions: Procedure used by colleges and universities who admit a set percentage of their applicants for admission. Minimum academic qualifications are required along with other qualitative standards.

Seminar: A class that has a group discussion format rather than a lecture format.

Silent Scores: The term is applied to PSAT scores because only the student and his or her guidance counselor see the scores. They are not reported to colleges. It is the “practice without penalty” feature of the test.


Standby: If a student registers for an SAT or ACT testing date and there are no seats available, the student may accept a standby position; that is, if a seat becomes available the day of the test, the student will take the test. The student must go to the testing center and wait to see if there is an open seat. A fee is attached to standby.


Student Aid Report (SAR): Report of the government’s review of a student’s FAFSA. The SAR is sent to the student and released electronically to the schools that the student listed. The SAR does not supply a real money figure for aid but indicates whether the student is eligible.


Student-Designed Major: Students design their own majors under this policy. It offers students the opportunity to develop nontraditional options not available in the existing catalog of majors.


Trade and Technical Schools: Trade schools typically offer specialized training in a specific trade or vocation. Trade and technical schools are typically small schools that focus specifically on one program, trade, or vocation. Trade and technical schools do not grant degrees, but usually grant certificates or diplomas. Classes at these schools are typically small and programs can usually be completed in two years or less.
Upon completion a program, the school may help you find a job relating to your field of study. Some programs also lead into apprenticeships, where you continue your education by working for an experience professional in the field. Talk to your high school counselor or career center for more information about apprenticeships and trade schools.

Transfer Program: This program is usually found in a two-year college or in a four-year college that offers associate degrees. It allows a student to continue his or her studies in a four-year college by maintaining designated criteria set down at acceptance to the two-year program. It is not necessary to earn an associate degree to transfer.


Transfer Student: A student who transfers from one college or university to another. Credits applied toward the transfer will be evaluated by the receiving school to determine the number it will accept. Each school sets different policies for transfers, so anyone considering this option should seek guidance.


Universities: Institutions of higher education. Universities, which usually consist of several faculties or colleges, are larger than colleges, have wider curricula, are involved in research, and grant graduate and professional as well as undergraduate.

Upper Division: This term refers to the junior and senior years of study. Some colleges offer only upper-division study. The lower divisions must be completed at another institution before entering these programs to earn a bachelor’s degree.


Virtual Visit: This is the use of the Internet to investigate various colleges by looking at their home pages. A student can “tour” the college, ask questions vie e-mail, read school newspapers, and explore course offerings and major requirements on line. It is not a substitute for a live visit.


Waiver to View Recommendations: The form many high schools ask their students to sign by which they agree not to review their teachers’ recommendation letters before they are sent to the colleges or universities to which they are applying.


Yield: The percentage of accepted students who will enter a college or university in the freshman class; these students have received formal acceptance notices and must respond by May 1 with their intention to enroll. The more competitive the school, the higher the yield percentage.

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