Legal entity to whom a lender extends credit for a period of time; a signed master promissory note serves as evidence of indebtedness.
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Consolidation Loan
Combining a borrower's loans by transferring all loans to one holder.
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Default Status
Failure to make payments on a timely basis or to comply with other conditions of a loan. Defaults are reported to national reporting agencies, which may affect future creditworthiness.
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Deferment
The period during with a borrower who meets certain criteria may suspend loan payments. On some loans the federal government pays the interest. In other cases, interest accrues and the borrower is responsible for it.
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Direct Subsidized Loans
Subsidized loans issued directly by the U.S. Government. Subsidized loans are awarded based on financial need and the Federal Government will pay interest on these loans when the borrower is in school (full or half time), their grace period, or a qualified deferment.
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Direct Unsubsidized Loans
Unsubsidized loans issued directly by the U.S. Government. Unsubsidized loans are not awarded based on financial need and the Federal Government does not provide interest benefits during in-school, grace or deferment periods.
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Disbursement
Release of loan funds to the borrower. Disbursement for most student loans is made in installments and is usually co-payable to the borrower and the school.
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Education Loan Counselor
The Academic Lending Center's loan specialists. Will assist you with your student loan consolidation questions and application.
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Extended Loan Repayment Schedule
Depends on the amount of your Federal Student Loan debt.
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Federal Family Education Loan Program (FFELP)
Loan programs authorized by Title IV, part B of Higher Education Act of 1965, as amended, that includes the Federal Stafford, Federal PLUS, Federal SLS, and Federal Consolidation Loan Programs. These loan programs are funded by lenders, guaranteed by guarantors, and reinsured by the federal government.
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Federal Subsidized Stafford Loans
These federal loans are awarded based on financial need. The Federal Government will pay interest on these loans when the borrower is in school (full or half time), their grace period or a qualified deferment.
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Federal Student Loan Consolidation
When a borrower consolidates, a lender pays off all the loans the borrower includes in their consolidation loan and in turn issues a new, single loan for the total amount.
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Federal Unsubsidized Stafford Loans
These federal loans are not awarded based on financial need. The Federal Government does not provide interest benefits during in-school, grace or deferment periods.
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Grace Period
The period that begins the day after the Stafford loan borrower ceases to be enrolled at lease half time at an eligible school ends the day before the repayment period begins, and during which payments of principal are not required. For a borrower with a Stafford loan that has yet entered repayment that also has an SLS loan, the grace period for the SLS loan is the equivalent of the grace period for the Stafford loan if the borrower requests grace on his or her SLS loan (s).
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Graduated Repayment Schedule
A repayment schedule under which the amount of the borrower's installment payment is scheduled to change (usually by increasing two or more increments), during the course of the repayment period. The graduated repayment schedule cannot exceed 10 years (or 25 years for borrowers eligible for an extended repayment schedule), excluding in school-grace, deferment, or forbearance periods.
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Income-Sensitive Repayment Schedule
A repayment schedule for some FFELP loans under which the borrower's monthly payment amount is adjusted annually, based on the total amount of the borrower's Direct loans, the borrower's family size, and the Adjust Gross Income reported on the borrower's most recent income tax return. In case of a married borrower, who files a joint income tax, the AGI includes the spouse's income.
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Interest Rate
The charge made to a borrower for use of a lender's money.
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Lender
Financial institutions (usually a bank, savings and loan, or credit union) that provides the funds for student loans.
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Plus Loans
Parent Loans for Undergraduate Students. Federally insured loans for parents of dependent students.
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Prepayment
A payment received when the borrower is not required to make either principal or interest payments; when a borrower is required to make interest payments, but previously authorized the lender to capitalize accruing interest; or when the borrower makes a payment that is greater than the amount of the borrower's regular installment or the amount due.
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Private Student Loan Consolidation
When a borrower consolidates, a lender pays off all the loans the borrower includes in their consolidation loan and in turn issues a new, single loan for the total amount. Please note, customers are currently not able to consolidate Federal Student Loans with Private Student Loans into one consolidated loan through the Academic Lending Center.
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Promissory Note
A legal binding agreement the borrower signs to obtain a loan under the FFELP, in which the borrower promises to repay the loan, with interest, in periodic installments. The agreement also includes information about any grace period, deferment, or cancellation provisions and the student's rights and responsibilities with respect to the loan.
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Repayment Period
The period during which, payments of principal and interest are required. The repayment period follows any applicable in-school or grace period and excludes any period of authorized deferment or forbearance.
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Standard Repayment Schedule
A repayment schedule under which the borrower pays the same amount for each installment payment through the entire repayment period or pays an amount that is adjusted to reflect annual changes in the loan's variable interest rate. The Standard Repayment Schedule cannot exceed 10 years, excluding in-school, grace, deferment, or forbearance periods.
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Subsidized Loan
A loan eligible for interest benefits paid by the federal government. The federal government pays the interest that accrues on subsidized loans during the student's in-school, grace, authorized deferment, and (if applicable) post-deferment grace periods, if the loan meets certain eligibility requirements.
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Treasury Bill (T-Bill)
A note or bill issued by the U.S. Treasury as legal tender for all debts.
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Unsubsidized Loan
A non-need-basis loan such as un unsubsidized Federal Stafford loan or a Federal PLUS loan. The borrower is responsible for paying the interest on an unsubsidized loan during in-school, grace, and deferment periods, in addition to repayment periods.
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