Debt-to-Income Ratio

A calculation used by creditors to determine a person's current ability to repay debt. It is calculated by taking gross monthly debt expenses divided by gross monthly income. An individual with more available income will have a
lower result.


Failure to make payments or otherwise failing to meet the terms and conditions of the student loan promissory note. Most federally insured student loans are in default if the loan reaches 270 days delinquent or other events have occurred. The time frame is much shorter for private student loans.


A period of time during repayment in which the borrower, after meeting certain criteria, is not required to make regular monthly payments. Note: Interest payments may or may not be postponed depending on the type of loan.


A payment that is not received by the due date.

Dependent Student

A student whose parents provide for more than half of his or her financial support, is not married, is under 24 years of age, has no legal dependents, is not an orphan of the ward or court, and is not a U.S. Armed Forces veteran.

Direct Lending Schools

Schools participating in the William D. Ford Federal Direct Student Loan (Direct Loan) Program enable students to receive federal student loans directly through them. This eliminates the need to apply for and receive student loans using a third party such as a bank, credit union, or private lender.

Direct Loan

A federal student loan issued under the William D. Ford Federal Direct Student Loan (Direct Loan) Program.


The delivery of all or a portion of the total loan funds to the borrower or other specified party. Student loan disbursements are generally delivered directly to the school for credit to the student borrower's account at the school.

Disbursement Amount

The amount requested or approved for disbursement. This amount includes origination, guarantee, and supplemental fees that are applicable to the loan program.

Disbursement Notification

A letter sent to the borrower to acknowledge approval of a loan. It also notifies the borrower of when funds will be sent to the school, the loan amount, and any fees (origination and/or guarantee) associated with the loan.

Disclosure Statement

A notification of the actual cost and terms of a loan, which includes the interest rate and any additional finance charges.