• Debt to Income Ratio - The percentage of a loan applicant's (monthly) income that is used to meet debt obligations. A lot of alternative loan programs use this calculation to determine an applicant's eligibility for a loan program.
• Default Failure - to repay a loan according to the terms agreed to when you signed a promissory note. Failure to submit requests for deferment or cancellation on time leads to default. Default consequences are severe.
• Deferment - A temporary period during which a borrower is not required to make payments. Such periods are more common in federal loan programs rather than alternative loans. For Perkins Loan borrowers and Subsidized Stafford Loan borrowers, many deferments are subsidized, meaning the interest that accrues on the loan during the deferment is paid by the federal government. There are also unsubsidized deferments, meaning the interest that accrues must be paid by the borrower.
• Delinquency - A period during repayment when the borrower, once he/she has met certain conditions, doesn't need to pay the loan principal.
• Department of Education - The federal agency that establishes financial aid programs and processes financial aid applications.
• Dependent Student - A 23 year old (or younger) student who requires his/her parents or guardians for financial assistance.
• Direct Costs - Costs that the college or university directly bills to the student. Fees and tuition are direct costs.
• Direct Loans - A federal loan issued directly from the government and administered by the college/institution. Such students who attending a school that participates in this program are required to complete the application process directly with their school.
• Direct Student Loan Consolidation - The process of combining multiple direct, federal student loans into one lower monthly payment.
• Disbursement - The act of sending federal loan funds to the student. These funds are paid both to the student and his/her school. Federal loan funds cover educational costs (tuition, fees, etc.) and related living expenses. The student is given directly any excess funds.
• Electronic Funds Transfer (EFT) - The process of electronically transferring loan proceeds from the lender to a school's account or the school's financial institution.
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