| Need is the only criteria that lead to a lot of | | | | Tuition |
| assistance aided by the government today. Especially | | | | - Books and supplies |
| when it comes to student educational needs, every | | | | - Housing costs (rent, utilities) |
| country's government has definitely taken pains to | | | | - Meals |
| invest on them. | | | | - Personal expenses (clothing, entertainment) |
| When a student applies for a financial aid, his financial | | | | - Transportation/travel |
| situation is analyzed and finally the need for students' | | | | - Support of dependents (if applicable) |
| loan is recognized. When the family or the individual | | | | - Any other miscellaneous expenses |
| himself cannot finance for the educational period then | | | | = TOTAL COST OF ATTENDANCE |
| the need for student loan comes into the screen to | | | | Terms to be known: |
| help all students. | | | | |
| Many private companies that exist to care students' | | | | 1. EMERGENCY LOAN: Temporary, low- or no-interest |
| education perform this exact calculation of need for | | | | loan assistance given to students to help them cover |
| students' loan. They include College Scholarship | | | | costs until their financial aid is received; usually |
| Service (CSS) or American College Testing (ACT), | | | | granted immediately and without question |
| who calculate these figures for colleges, private | | | | 2. GRACE PERIOD: A period of time after college |
| institutions, and government agencies. | | | | graduation - typically six to twelve months - in which |
| These private organizations are not the one that | | | | a student does not have to begin repaying a loan |
| decides the amount being offered to students. | | | | 3. Interest: a charge for borrowed money; generally a |
| The amount that is to be sanctioned would be | | | | percentage of the amount borrowed (see Principal |
| decided by individual schools, on the basis of various | | | | below) |
| factors such as amount of aid funds available at that | | | | 4. LOAN CONSOLIDATION: A repayment option for |
| particular school and how many other students are | | | | students with more than one outstanding loan; this |
| also applying for aid. | | | | lowers monthly payments and makes the repayment |
| It is declared that parents are not the only to pay a | | | | process simpler |
| student for his /her education. A substantial amount | | | | 5. LOAN DEFAULT: The failure to repay a loan |
| from student's income and savings would also | | | | according to the terms agreed to in the promissory |
| contribute to his education. Parents are not the only | | | | note; a lender may take legal action to get the |
| ones who are expected to partially finance a college | | | | money back |
| education. In such cases need for students' loan | | | | 6. LOAN DEFERMENT: A postponement of a loans |
| becomes an implicit need. In general the formula | | | | repayment; many federal loan programs have a |
| would be, | | | | deferment program |
| Total Cost of College - Estimated Family Contribution | | | | 7. LOAN DELINQUENCY: Failure to make loan |
| = Financial Need | | | | payments when they are due; extended delinquency |
| Note: Source News: | | | | can result in loan default |
| Congress under the Higher Education Amendment of | | | | 8. LOAN FORGIVENESS: Demand for repayment of |
| 1986 developed a standard formula used by these | | | | the balance of a loan is waived because of |
| companies. | | | | extenuating circumstances on the students part, such |
| Called the Congressional Methodology, it is used to | | | | as financial hardship or, in some cases, in |
| evaluate parents' income and assets, in conjunction | | | | compensation for community service |
| with the number of children in the family who are | | | | 9. PRINCIPAL: In terms of loans, this represents the |
| college-aged and their anticipated college costs. | | | | amount of money borrowed, not including any |
| Estimated Family Contribution Calculator: | | | | interest charges (see Interest above) |
| The College Board offers an online EFC calculator to | | | | 10. SUBSIDIZED LOAN: A loan that does not accrue |
| help estimate this amount. | | | | interest until the recipient leaves school |
| The list would be, | | | | 11. |