Regions Bank, we understand college is a big deal. And it's never cheap. So, we want to make it easy for you to get money. That's why we offer four great student loan options. All with a low fixed interest rate. Your origination fees are waived if you are a student (Stafford loan) attending school or residing in AL, CA, CO, CT, FL, GA, IL, IN, KY, LA, MA, MS, MD, NJ, NV, OH, PA, RI, TN, or TX.

Accrued Interest
The amount of interest, calculated daily, that has accumulated on the unpaid amount of your loan.

American College Testing (ACT) publishes the ACT Assessment Test, commonly known as the ACT. It is a standardized, multiple-choice test used by some colleges as part of the admissions process that is administered five times a year. The ACT measures academic achievement in four areas: English, Math, Reading, and Science.

Adjusted Gross Income
Taxable income from all sources. (See your Federal Income Tax Form 1040 EZ, line three, or Form 1040, line 31.)

The reduction of loan balance by your monthly payments.

Items of financial worth which may include your home, business, savings and checking accounts, stock, bonds, real estate, trust funds, etc.

Award Letter
This official document issued by a college’s Financial Aid Office lists all of the financial assistance offered to a student.

The person to whom a loan is made and who agrees to repay it. The borrower signs a promissory note, which serves as the formal promise to repay the loan.

The process of adding unpaid interest to the outstanding principal balance of a loan. This results in an increase in the outstanding principal balance of the loan and may cause an increase in the monthly payment amount.

Certificate of Indebtedness (COI) or Loan Verification Certificate
A Certificate of Indebtedness provides verification from the holder(s) of your student loan(s) regarding the payoff balance on your loan(s).

Co-Borrower (Signer)
A co-borrower is a second or additional party who receives the loan proceeds and agrees to repay the loan.

A signer of a promissory note who agrees to pay the loan if the Borrower defaults.

Cost of Attendance (COA)

The total amount a student must pay to attend school for one academic year, including tuition, room and board, books, supplies, transportation, and personal expenses. A college’s Financial Aid Office determines this figure.

Coverdell Education Savings Account (IRA)
This IRA allows a related taxpayer to deposit up to $2000 per year for each child under the age of 18. Interest earned on this type of IRA will be tax-free. In addition, withdrawals from a Coverdell Education Savings IRA will be tax-free as long as the withdrawals are used for qualified educational expenses. Any individual can contribute to a Coverdell ESA if the individual’s Modified Adjusted Gross Income (MAGI) for the year is less than $110,000. For individuals filing joint returns that amount is $220,000. Above the maximum income level, the allowed contribution is zero.

Credit-Based Loans

Loans (i.e. PLUS) that are made to you based on your credit worthiness as opposed to Federal Stafford Loans and grants which are determined through a need analysis process based mostly on the cost of education.

Failure to pay your loan according to the terms disclosed on your promissory note. You are in default on a FFEL Program Loan if your payments are more than 270 days past due or if you fail to comply with other terms of the loan.

A period of time during repayment when the borrower, upon meeting certain criteria, is not required to make regular monthly payments. Depending upon the type of loan, the interest may or may not be paid by the government during the deferment period.

If a payment is not received by the due date, it is considered delinquent. Delinquencies greater than 30 days are generally reported to national credit bureaus.

Direct Lending Schools

Institutions of higher education which have chosen to place all of their students' federally insured student loans through the Federal Direct Lending Program. Such colleges or universities may either participate exclusively in the Direct Lending Program or allow students (borrowers) to choose the lending program from which to borrow.

Disbursement Notification

A letter that is sent to you acknowledging that your loan is approved and letting you know when the money will be sent to your school, as well as the loan amount and any fees (origination or guarantee). This marks the successful completion of the loan application process.

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

This is an electronic format of information used by Stafford and Parent Plus borrowers to sign their Master Promissory Note online. The process is available on our Web site for a select group of schools that participate in the e-signature process, and certify loans through Tennessee Student Assistance Corporation (TSAC).

EFT (Electronic Funds Transfer)
The process whereby your bank sends the loan proceeds electronically to your school if the school participates in this program.

Eligible Citizen
A United States citizen, U.S. national, or resident of certain U.S. territories who qualifies to borrow under the FFEL or FDL student lending programs.

Eligible Non-Citizen
A permanent resident of the United States who is able to present evidence from the Immigration and Naturalization Service that he or she is in the US for other than a temporary purpose with the intention of becoming a citizen or permanent resident.

Emergency Loan Program
These are short-term, low-interest loans with a low interest rate and are administered by your school's Financial Aid Office. Many graduate schools provide loan funds for emergencies or unexpected expenses.

Exit Interview

An in-person or online counseling session with the school's Financial Aid Office before graduation or withdrawal to review the terms and obligations of your student loan.

Expected Family Contribution (EFC)
The amount a family is expected to pay toward college costs. This amount is determined via the FAFSA process by a need analysis formula established by the federal government and can be found on your Student Aid Report (SAR).

The Free Application for Federal Student Aid (FAFSA) is a standard federal form used to determine your eligibility for most types of financial aid including Federal Government backed loans. The FAFSA is typically completed early in the year and it requires income, asset, and tax information from the students and/or parents.

Federal Family Education Loan (FFEL) Program

A loan program authorized by the Federal Government in the Higher Education Act of 1965, as amended. This program includes Federal Stafford, PLUS and Consolidation Loans. These loans are funded by lenders, guaranteed by guaranty agencies and ultimately insured by the Federal Government.

A temporary postponement of principal and interest payments during which the borrower may only pay the interest on the loan. If the borrower chooses not to pay the interest, it will be capitalized at the end of the period.

Financial Aid Package

The total amount of monetary assistance available to the student including all grants, scholarships, work-study and loans available from school, state and federal programs, as listed in a college’s financial aid award letter. It does not include alternative, non-federally guaranteed loans.

Financial Need (or Aid Eligibility)

The difference between the total cost of attendance and the Expected Family Contribution.

Federal Supplemental Educational Opportunity Grants (FSEOG)

Government grants distributed by colleges, at their discretion, to students based on need.

Full-time Employment
Working at least 30 hours per week in a position that is expected to last at least three months.

Good thru Date for Payoff
The date your payoff amount should arrive at the lender or servicing agent.

Grace Period
An amount of time allowed before principal repayment of a loan must begin after a student graduates, leaves school or drops below half-time status. No payments on your student loans are required during this time. Details of your grace period are specified in your promissory note and are not available for all loans.

A form of financial aid, similar to scholarships, that does not have to be repaid.

Gross Income
Your income before taxes and deductions.

Guarantee/Insurance Fee
A sum charged by the guaranty agency to insure a loan. The guarantee fee (sometimes called an insurance fee) is deducted from the principal amount of your loan and paid by your lender to the guaranty agency.

Guaranty Agency
A state or non-profit organization, which has an agreement with the Secretary of Education under the Higher Education Act to insure student loans made by lenders.

HOPE Scholarship Tax Credit
This tax credit is available to those taxpayers who are paying education expenses for students enrolled in their first two years of college. The Hope Tax Credit is available for up to 100% of the first $1,000 of qualified tuition and related expenses (i.e. tuition and fees, but not room and board and books) and 50% of the second $1,000. The Hope Scholarship Tax Credit is for expenses paid after December 31, 1997. It will be reduced on a pro-rata basis for those who file a single tax return with incomes of $40,000-$50,000 and for those who file joint tax returns with incomes of $80,000-$100,000. (Single return tax filers with incomes of $50,000 and joint return tax filers with incomes of $100,000 and above will not be eligible for a deduction.) The Hope Scholarship Tax Credit is part of the Taxpayer Relief Act of 1997.

The amount of money that you owe to others.

The fee charged to borrow money, usually a percent of the outstanding amount, which accrues and is paid over the life of a loan.

Interest Only Payments
Payments that will only decrease the amount of interest owed on your student loan.

Late Fee
An administrative charge that a lender may assess if a student loan payment is not received within 15 days after its due date.

Lifetime Learning Tax Credit
The Lifetime Learning Tax Credit is available to people beyond the first two years of undergraduate studies, graduate students or working U.S. citizens taking classes to improve or upgrade their job skills. It can be used for qualified tuition and related expenses (i.e. tuition and fees, but not room and board and books) paid by the taxpayers. The tax credit equals 20% of the first $5,000 of expenses paid by the taxpayer after June 30, 1998 through December 31, 2002 and 20% of the first $10,000 after January 1, 2003. The tax credits are reduced on a pro-rata basis for single return tax filers with incomes of $40,000 - $50,000 and for joint return tax filers with incomes of $80,000 - $100,000. (Single return tax filers with incomes of $50,000 and joint return tax filers with incomes of $100,000 and above will not be eligible for a deduction.) The Lifetime Learning Credit is part of the Taxpayer Relief Act of 1997.

A sum of money borrowed (principal) usually for a specific reason (e.g., to obtain an education, buy a car, etc.). The entity lending the money (e.g. a bank) usually charges interest for use of the money. The amount of money borrowed is typically repaid with interest over a period of time.

Master Promissory Note (MPN)
Master Promissory Note refers to the revised promissory note which the Department of Education has authorized to be used with Stafford loans beginning 7/1/1999. It allows lenders to use a single MPN instead of requiring borrowers to sign a new promissory note for additional advances.

Minimum Wage
As of 9/97 the rate is $5.15 per hour. This rate will occasionally change based on federal law. The minimum wage is defined by Section 6 of the Fair Labor Standards Act of 1938 and is adjusted by the U.S. Congress from time to time.

Multiple Disbursements
Loan proceeds that are paid in more than one check or electronic transaction. For example, a portion of a loan may go towards the first semester of school and the balance for the second semester.

Non-Direct Lending Schools
Institutions of higher education which have chosen to place their students' federally insured student loans through the Federal Family Education Loan Program (FFELP). In the FFEL program, borrowers choose a lender from which to borrow and the lender then obtains a loan guarantee from a state or private guarantee agency.

Origination Fee
A sum charged by the Federal Government on FFEL loans to offset the cost of processing the loan. The amount of the fee is deducted from the dollar amount of your loan by the lender and paid to the U.S. Department of Education.

Payment Schedule
A summary of the terms of a loan, which includes the total principal amount, the date payment begins and the interest rate.

Payoff Balance
This is the total amount you would owe if you were to pay off your entire loan. It includes the outstanding principal plus any unpaid accrued interest.

Pell Grants
One of the largest sources of grants, Pell Grants are distributed by the Federal Government and are designed to help students with financial need pay for college.

Perkins Loans
A campus-based, low interest loan for graduate and undergraduate students. The college acts as the lender using a limited pool of funds provided by the federal government. These loans are awarded based on exceptional financial need.

PLUS (Parent Loans for Undergraduate Students)
These are loans under the FFEL program for parents of dependent undergraduate students. They require a credit check. The interest rate is low and repayment begins 60 days after disbursement.

Poverty Line
The poverty guidelines as published by the Department of Health and Human Services for monthly household income are:

  • 48 contiguous states and District of Columbia = $967.50 per month
  • Alaska = $1,209.17 per month
  • Hawaii = $1,113.33 per month

The dollar amount of the loan that must be repaid upon maturity, and upon which interest will be charged.

Principal Balance
The outstanding amount you owe, excluding accrued but unpaid interest.

Promissory Note
This is a legally binding agreement the borrower signs to obtain a loan and in which the borrower promises to repay the loan, with interest. The note includes all the terms and conditions of the loan. Keep your copy in your permanent files.

The Preliminary Scholastic Assessment Test (PSAT) is a two-hour test given once a year in October. As with the SAT, you receive separate math and verbal scores. In addition, the test also includes a third scored section testing English grammar. Each subject is scored on a scale of 20 to 80 and these scores are combined to create your National Merit Scholarship selection index.

Repayment Period
This is the amount of time during which you repay the money borrowed plus interest.

The period during which a physician receives specialized clinical training.

Scholarships, like grants, are a form of financial aid that do not have to be repaid. These are available from many sources including community groups, schools and private corporations. Scholarships can be awarded based on a variety of criteria including scholastic achievement, hobbies and college majors.

The Scholastic Aptitude Test (SAT) is a seven-section, three-hour exam that is administered seven times a year. Three of the sections are verbal, three are math, and one is experimental. The experimental section can be either verbal or math. It is used by the test-makers for research purposes only and will not count toward your final score.

Stafford Loan
Loans under the FFEL program awarded on the basis of financial need. They may be subsidized or unsubsidized. These loans can be made from a bank, credit union or other eligible lender.

Indicates the condition of your student loan. Examples would include "in school" and "repayment."

Student Aid Report (SAR)
A report sent to a student by the government 4 – 6 weeks after submitting a FAFSA. The report informs the student of the Expected Family Contribution (EFC) and the financial aid for which the student is eligible. College financial aid offices use the report information to build a financial aid package for a student.

Student Loan Interest Deduction
Eligible taxpayers may deduct on their federal income tax return the amount of interest they have paid during the tax year on any qualified education loan for the period of time as defined by law. The deduction applies to interest paid after December 31, 1997 and is phased out for single taxpayers with incomes of $40,000-$55,000 and for joint taxpayers with incomes of $60,000-$75,000. Single return tax filers with incomes of $55,000 and joint return tax filers with incomes of $75,000 and above will not be eligible for a deduction. (Qualified education expenses generally include tuition, fees, room and board.) The Student Loan Interest Deduction is part of the Taxpayer Relief Act of 1997.

Subsidized Loan
A loan on which the government pays the interest for a student while enrolled in school at least half-time and during periods of grace and deferment (i.e. Subsidized Federal Stafford Loan).

Unsubsidized Loan
A loan on which the borrower is always responsible for paying the interest while in-school and during deferment, forbearance and grace periods. (i.e. Unsubsidized Federal Stafford Loan or Federal PLUS Loan).

Variable Interest

Interest rates that change periodically (e.g. quarterly, annually etc.). The interest rates for Federal Stafford and PLUS Loans are set by the government each year and change annually on the first of July.


Part of the Federal Student Financial Assistance Program that provides part-time employment for post-secondary students who need income to help meet education costs.

This is an IRS form which taxpayers use to certify that loans meet the definition of qualifying education debt and which allows lenders to report to the IRS the amount of interest paid on student loans as interest which qualifies for possible tax deductions.

91-day T-Bill
Refers to the auction rate determined for 91-day Treasury Bills by the public auction held by the United States Treasury Department. The interest rates for Stafford and PLUS loans are tied to the auction rates held at certain times of the year. The rate(s) can be obtained from the Treasury Department, but is also available in many newspapers including The Wall Street Journal.