Financial Aid Glossary

Here are some key financial aid terms and acronyms you’ll need to know as you navigate paying for college.

Alternative loans
Commercial, non-federal loans, from lenders of the students’ choice, intended for students who need extra money to help cover educational costs not met by their other financial aid. Alternative loans involve a credit check, and interest rates may be higher than with the government-sponsored educational loans. But they still may be a better option than other kinds of loans available to families.

Authorized payer
Someone you have authorized (given a username and password) to make online payments on your account and review online statements (bills) and receive notifications when statements are available.

Budgeted cost of attendance

The annual average expense budget, which includes cost of tuition, mandatory fees, room and board, books and supplies, transportation, miscellaneous/personal expenses, and average loan fees. This total amount is the maximum amount of financial aid you may receive.

Credit balance check
When a payment to your account, including financial aid, is higher than the amount owed, SFS will return these funds to you, either by paper check in the mail or electronically by direct deposit.

Deferment/forbearance
The borrower’s right to postpone monthly payments on a loan. Borrowers should check with lenders to determine eligibility.

Direct deposit
Funds transferred electronically to your personal banking account.

Expected Family Contribution (EFC)
Financial contribution that is expected to be available to assist in your education costs. It is determined by the federal methodology need-analysis formula approved by the U.S. Congress. The EFC includes the parent contribution and the student contribution, and depends on the student’s dependency status, family size, number of family members in school, taxable and nontaxable income and assets, and a number of other variables reported on the Free Application for Federal Student Aid (FAFSA).

Family Educational Rights and Privacy Act (FERPA)
A federal law that limits access to your information, such as the offer of financial assistance and your account details. You may grant access to your financial aid and student account information to individuals you feel should legitimately know this information.

Financial need
The difference between the cost of attendance and the expected family contribution (EFC). Grants, need-based loans, work study, and scholarships count toward meeting your financial need.

Free Application for Federal Student Aid (FAFSA)
Application used to apply for all need-based aid, including loans, grants, work study, and non-need-based federal loans. There is no fee to file the FAFSA, but it must be completed each year to reapply.

Grace period
The period of time after graduation or dropping below half-time status before your loan repayment begins.

Grant
A type of financial aid, based on financial need, that you do not have to repay.

Interest rate
The percentage rate added to the loan. Need-based loan interest is subsidized, and does not accrue while you are enrolled at least half-time, during some periods of deferment, or for most loans, during the grace period. Non-need-based (unsubsidized) loan interest accrues upon disbursement.

Loan
A type of financial aid that must be repaid with interest. Interest rates and terms vary; review master promissory note (MPN) for details.

Master Promissory Note (MPN)
The binding legal document that must be signed by you or a parent borrower before loan funds are disbursed by the lender. This document is always filled out with the lender providing the loan, and it serves as the signed application for that loan. It states the terms and conditions, including repayment, interest rate, deferment policy, and cancellations. The borrowers should keep this document until the loan has been repaid.

Offer of financial assistance
The complete collection of grants, scholarships, loans, and work-study awards from all sources (federal, state, institutional, and private) offered to you; some of this is determined from your FAFSA.

Online payments
Through online payments, you and authorized payers can pay charges on your student account by e-check or credit card using a contracted service called QuikPay. American Express, Discover, MasterCard, and Visa are accepted. Any payment made toward your account will be reflected on the account the following business day.

Outside scholarships
A scholarship that comes from sources other than the school and the federal or state government.

Payment plans
SPU offers payment plans, to divide your remaining charges — after all financial aid has been added to your account — into monthly payments. There is a $100 fee to enroll in an annual plan and a $50 fee to enroll in a quarterly plan.

Priority deadlines
The date you must file the FAFSA to ensure that you will be considered for the widest variety of aid.

Satisfactory Academic Progress (SAP)
You must achieve this in order to continue receiving financial aid from Seattle Pacific University. SAP is achieved by meeting the following academic requirements:

  • Complete (letter grade A, B, C, D, or P) at least 70 percent of all attempted credits.
  • Maintain at least a 2.0 cumulative grade point average after the second year of enrollment, and by the end of each subsequent quarter.

Note: Washington state has a different definition of SAP based on credits, not GPA.

Scholarship
Funds for educational costs, granted to you because of need, merit, or affiliation. These funds do not need to be repaid. SPU scholarships have individual renewal criteria.

Statement of Eligibility
A document that will be sent to you that you can show to an employer to document your work-study eligibility.

Student account
The service through which you as an enrolled student receive all University charges, and by which funds can be paid on your behalf.

Verification
The process by which information on the FAFSA is confirmed. The federal government selects students at random to submit tax documents and other documents to the University.