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Common Terms

Deferment: A postponement of payment on a loan that is allowed under certain conditions and during which interest does not accrue for Subsidized loans.

Grace Period: Time allotted after borrowers graduate, leave school, or drop below half-time enrollment, before payments are due.  Typically grace periods for Stafford loans are 6 months. Each loan only has one grace period. If borrower returns to school after the grace periods has expired, the borrower’s loans do not receive an additional grace period. Borrower may be eligible for in-school deferment while enrolled at least half-time, but loans return to repayment after leaving school.

Forbearance: A period during which your monthly loan payments are temporarily suspended or reduced. You may qualify for a forbearance if you are willing but unable to make loan payments due to certain types of financial hardships.

Default: Failure to repay a loan according to the terms of the promissory note.

Capitalized interest: Capitalization means that a lender adds the interest that accumulates on a loan to the outstanding principal balance, increasing the total amount owed (or the balance) on the loan. After that, interest is charged on the new total principal balance.

Loan Principle: The total sum of money borrowed. Loan principal includes the original amount borrowed plus any interest that has been capitalized.

Lender: The organization that made the loan initially could be a bank, credit union or other lending institution for loans under the FFEL program; or the U.S. Department of Education for loans under the Direct loan program.

Servicer: An organization designated to track and collect a loan on behalf of a loan holder.

Guaranty Agency: The organization that administers the FFEL program in your state.

National Student Loan Data System

The National Student Loan Database is the U.S. Department of Education’s central database of student aid. By visiting the NSLDS Student Access website, you can access information about your federal student loans (Stafford, Direct Stafford, PLUS (Grad and Parent), Consolidated loans and Pell Grants.

Setting Up an NSLDS Account

To access information on NSLDS, you must supply the following information:

  • Your Social Security number.
  • The first two letters of your last name.
  • Your date of birth.
  • Your U.S. Department of Education PIN.

If you don’t yet have a Department of Education PIN, you can establish one by visiting the PIN website.

Using NSLDS Information

NSLDS offers detailed information such as:

  • Loan amounts.
  • Name of the loan holder and contact information
  • Loan guarantor
  • School associated with each loan
  • Pell-Grant award amounts
  • Pell-Grant award year
  • School associated with each Pell Grant.