Definitions for "Special Allowance"
The payment the federal government provides to lenders to bring total interest rates up to market value; acts as an incentive to lending institutions to offer loans in the Federal Family Education Loan programs.
A wholesaler's discount offered to retailers as an incentive to increase sales of a product. Also called a special purchase.
A quarterly supplemental interest payment to lenders based on the outstanding principal balance of Stafford, PLUS, SLS and Consolidation loans. This payment assures that, as a complement to the borrower's interest rate, the lenders receive a guaranteed yield on their loans even when interest rates change.