FINANCIAL AID 101
The form you complete to apply for college financial aid
What is the FAFSA
Money that must be paid back with interest expense
What is a loan
A record of how a consumer has repaid credit obligations in the past; shows payment history, late payments, liens, debt forgiveness, bankruptcy filings, and number of inquiries by prospective lenders.
What is credit history/credit report or credit bureau
Name of an account you should have available to cover unexpected expenses; and how much should it equal
What is an emergency fund...should equal 3-6 months salary
A nine-digit identification number unique to each individual
What is a social security number
The Federal Direct Student Loan that does not accrue interest while you are in school
What is a SUBSIDIZED Direct Loan
The cost of borrowing money
What is interest expense
Equifax, TransUnion and Experian
Who are the three national credit reporting agencies
Convenient way to pay for things that is an alternative to checks or cash and is linked directly to bank account
What is a debit card
Venmo might be another option
What is identity theft and credit card fraud
The six-month period after graduation, during which you are not required to make payments on your student loan.
What is a grace period
This type of interest rate will change when the index changes
What is a variable interest rate loan
Maintain credit histories and provide lenders with FICO scores
What do credit reporting agencies do?
Type of expenses that stay the same each month
What are fixed expenses
File a police report and get a copy for your files
Also contact credit reporting agencies to freeze your credit.
Federal student or parent loan with a 7.54% interest rate has a fee of 4.228%
What is a GradPLUS Loan or a ParentPLUS Loan
The additional of unpaid interest to the principal balance of a loan
What is interest capitalization
What many lenders use to assess an individual's credit risk
What is FICO score.
FICO scores may also be used by landlords, insurance companies and employers
Track spending and savings and giving you permission to spend your money
What is the purpose of a budget
This modern-day fraudulent practice of sending emails purporting to be from a reputable company in order to induce individuals to reveal personal information, such as passwords, bank account numbers and credit card information
What is Phishing
A repayment plan for federal student loans which considers annual income
What are income driven repayment plans
If a loan offers an interest rate reduction for Auto-debit
What is a borrower benefit or repayment discount
What is payment history
The 50 - 20 - 30 Rule
What is the plan to spend 50% of your income on needs (housing, food, clothing), 20% on savings and 30% on wants (like entertainment, dining out etc)
Federal agency in charge of dealing with complaints of identity theft
What is the Federal Trade Commission