Guaranty AgencyThe company that administers the Federal Stafford Loan and Federal PLUS Loan programs in a state. The government sets loan restrictions and rates of interest, but each state can set a unique extra tips, within federal laws.
Guaranty FeeAn insurance coverage premium deducted through the borrower’s loan profits just before disbursement and paid to the guaranty agency that guarantees the mortgage. For legal reasons, the cost cannot go beyond one percent regarding the loan amount.
InterestA fee charged for the usage of lent cash. Interest percentage is calculated as a share for the loan amount that is principal. The price can be constant for the lifetime of the mortgage (fixed price) or it might change at certain times (variable price). At the time of July 1, 2006, all federal training loans built to brand brand new borrowers have actually fixed interest levels.
LenderA financial institution (bank, cost savings, and loan or credit union) providing you with the funds for students and parents to borrow academic loans.
Requirements AnalysisA means of reviewing a student’s aid application to look for the quantity of school funding student is entitled to receive. Doing a requires analysis type (FAFSA) is the necessary step that is first trying to get many forms of educational funding.
Brand New BorrowerA borrower who may have no outstanding (unpaid) loan balances in the date (s)he signs the promissory note for a certain academic loan. New borrowers could be at the mercy of regulations that are different borrowers that have current loan balances.
Origination FeeA charge charged by the government that is federal deducted from loan profits before disbursement to partially offset administrative expenses for the Federal Family Education Loan Program (FFELP).
Pell GrantA grant that is federal for first-time undergraduates with monetary need.
PrincipalThe quantity lent.