Federal Student Loans
Nebraska Methodist College provides a variety of student loan options to help students cover direct costs, such as tuition, fees and textbooks as well as indirect costs, like living expenses. Unlike grants and scholarships, loans must be repaid.
Students are encouraged to apply for grants and scholarships to help minimize borrowing. Students are also encouraged to apply for all possible federal aid options before applying for a private student loan.
Federal Perkins Loan
A limited number of Federal Perkins Loans are awarded each year to students with exceptional financial need. This loan accrues no interest and requires no repayment while the student attends school at least half-time. Repayment begins nine months after a student graduates, leaves school, or drops below half-time, at which time interest begins to accrue at a fixed annual rate of 5%. Students entering certain professions may have a portion or the entire loan forgiven by the U.S. Department of Education. Although federal program rules allow for loans up to $5,500 per year, a typical award at NMC is $2,000 - $3,000 due to the limited funding available.
NOTE: This program is scheduled to end as of September 30, 2015 unless Congress takes action to extend it.
Federal Direct Loans
NMC participates in the William D. Ford Federal Direct Loan program (Direct Loan). The U.S. Department of Education provides funding and serves as the lender for Direct Loans.
Direct Loans are fixed rate loans that do not require a credit check. Loans are made in the student’s name, and the student is responsible for paying back the entire loan sum plus accrued interest. Eligibility is based on the student’s FAFSA results.
First-time borrowers must complete the Federal Direct Loan Master Promissory Note (MPN) and Entrance Counseling. Both can be completed online at www.studentloans.gov.
Students who have borrowed a Federal Direct Loan at a previous institution may be able to use the same MPN for new Direct Loans borrowed at NMC.
- Direct Subsidized Loans are available to undergraduate students with financial need as determined by the FAFSA results. The federal government pays interest on the loan while the student is in school at least half-time. Effective for new borrowers on or after July 1, 2013, federal law limits the period of time for which a borrower may receive Subsidized Loans, in aggregate, to 150% of the published length of the student's current educational program. After that time, the student may borrow only Unsubsidized Loans and interest begins to accrue on the outstanding Subsidized Loan balance. The interest rate on Subsidized Loans for the period of July 1, 2015 through June 30, 2016, is fixed at 4.29% annually.
- Direct Unsubsidized Loans are available to both undergraduate and graduate students. Unsubsidized loans are not based on financial need, though a FAFSA must still be completed in order to qualify. Interest begins to accrue at the time the loan is disbursed. The interest rate on Unsubsidized Loans for the period of July 1, 2015, through June 30, 2016, is fixed at 4.29% annually for undergraduate students and 5.84% annually for graduate students.
The table below shows the annual and aggregate borrowing limits under the Direct Loan program. Note that aggregate totals also include outstanding loans borrowed through the former Federal Family Education Loan Program (FFELP) which includes Stafford Loans and Guaranteed Student Loans.
|Year||Dependent Student||Independent Student|
|First Year Undergraduate||$5,500—No more than $3,500 of this amount may be in subsidized loans.||$9,500—No more than $3,500 of this amount may be in subsidized loans.|
|Second Year Undergraduate||$6,500—No more than $4,500 of this amount may be in subsidized loans.||$10,500—No more than $4,500 of this amount may be in subsidized loans.|
|Third and Beyond Undergraduate (each year)||$7,500—No more than $5,500 of this amount may be in subsidized loans.||$12,500—No more than $5,500 of this amount may be in subsidized loans.|
|Graduate and Professional Degree (each year)||$20,500 Unsubsidized (As of July 1, 2012, subsidized loans are no longer available to graduate and professional degree students.)|
|Maximum Total Debt (aggregate loan limits)||$31,000—No more than $23,000 of this amount may be in subsidized loans.||$57,500—No more than $23,000 of this amount may be in subsidized loans. These limits include any loans received as a dependent student.||$138,500—No more than $65,500 of this amount may be in subsidized loans. The graduate debt limit includes loans received for undergraduate study.|
Repayment of Direct Loans begins six months after the student graduates, leaves school, or drops below half-time. There are several repayment options available, some of which are based on the borrower's income at the time of repayment. Select these links for additional information on repayment options, loan cancellation or discharge, loan deferment or forbearance, or loan repayment calculators.
Direct PLUS Loans are available to parents of a dependent undergraduate student. The interest rate is fixed at 6.84% annually, and interest begins to accrue when the loan is disbursed. This loan is based on the parent's credit history, and adverse credit may result in the loan being denied. If a PLUS Loan application is denied, the student may be eligible for an additional Direct Unsubsidized Loan.
To be considered for a PLUS Loan, the student must complete a FAFSA. The parent must also complete a Federal Direct PLUS Promissory Note (MPN) online at www.studentloans.gov. If the parent borrowed a Direct PLUS Loan for the student at a previous college, NMC may be able to use the same MPN. Please notify the NMC Financial Aid Office if your parent borrower has borrowed a prior Direct PLUS Loan.
Repayment for a Direct PLUS Loan begins within 60 days after the loan is fully disbursed. However, the parent borrower may defer repayment while the student is enrolled at least half-time and for an additional six months after the student is no longer enrolled at least half-time. Payments on a PLUS Loan may also be deferred if the parent borrower is enrolled in school at least half-time. Interest during these periods will be capitalized if not paid by the parent during the deferred payment period.
Health Professions Loans
NMC participates in the following loan programs funded by the U.S. Department of Health and Human Services through the Health Resources and Services Administration (HRSA).
Nursing Student Loans are available to students enrolled in an undergraduate nursing program. Students must have financial need as determined by the FAFSA, and they must not have an adverse credit history.
Nurse Faculty Loans are available to students in the Master of Science in Nursing-Nurse Educator track and students in the RN to MSN Educator program. Up to 85% of the loan may be cancelled if the student works as a full-time nursing faculty for a prescribed period of time after graduating from the MSN program. NMC requires applicants to submit a FAFSA each academic year for which funds are desired. The loan is not based on need.