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:  The Federal Perkins Loan program was renewed with a two-year extension until September 2018.

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. Students must be enrolled at least half-time during the period for which the loan is awarded. All loans require completion of the FAFSA and a Master Promissory Note. Entrance Counseling is also required for all first-time student borrowers.

Direct Subsidized & Direct Unsubsidized 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. Be sure to complete the Entrance Counseling appropriate for your program of study (undergraduate or graduate).

Students who have borrowed a Direct Subsidized or Direct Unsubsidized 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. The interest rate on Direct Subsidized Loans for the period of July 1, 2016, through June 30, 2017, is fixed at 3.76% 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 Direct Unsubsidized Loans for the period of July 1, 2016, through June 30, 2017, is fixed at 3.76% annually for undergraduate students and 5.31% annually for graduate students. 

A small fee is withheld from each loan disbursement. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. For loans first disbursed on or after Oct. 1, 2015, and before Oct. 1, 2016, the fee is 1.068%. For loans first disbursed on or after Oct. 1, 2016, and before Oct. 1, 2017, the fee is 1.069%.

Direct PLUS Loans are fixed rate loans available to graduate students and parents of dependent undergraduate students. The interest rate on loans for the period of July 1, 2016, through June 30, 2017, is 6.31% annually, and interest begins to accrue when the loan is disbursed.

This loan is based on the borrower's credit history, and adverse credit may result in the loan being denied. A borrower with adverse credit may still receive a Direct PLUS Loan by providing a qualified endorser, or by documenting to the satisfaction of the U.S. Department of Education that there are extenuating circumstances related to the adverse credit history. If a Parent PLUS Loan is denied, the dependent student may be eligible for an additional Direct Unsubsidized Loan.

Direct PLUS Loans are not based on need, however a FAFSA must be completed in order to qualify.

  • Graduate PLUS Loans are available to eligible students enrolled at least half-time in a graduate degree program. First-time borrowers of a Graduate PLUS Loan must complete Entrance Counseling for graduate students. The PLUS MPN for Graduate/Professional Students must also be completed. Entrance Counseling and the MPN can be completed online at www.studentloans.gov. Students who have borrowed a Graduate PLUS Loan at a previous institution may be able to use the same MPN for new Graduate PLUS Loans at NMC.
  • Parent PLUS Loans are available to the biological, adoptive, or in some cases, stepparent of a dependent undergraduate student enrolled at least half-time. The borrower must complete a PLUS MPN for Parents 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.

A small fee is withheld from each loan disbursement. The loan fee is a percentage of the loan amount and is proportionately deducted from each loan disbursement. For loans first disbursed on or after Oct. 1, 2015, and before Oct. 1, 2016, the fee is 4.272%. For loans first disbursed on or after Oct. 1, 2016, and before Oct. 1, 2017, the fee is 4.276%.

Borrowing Limits

The table below shows the annual and aggregate borrowing limits under the Direct Subsidized & Direct Unsubsidized 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.

YearDependent StudentIndependent 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.


In addition, effective for new borrowers on or after July 1, 2013, federal law limits the period of time for which a borrower may receive Direct 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 Direct Unsubsidized Loans and interest begins to accrue on the outstanding Direct Subsidized Loan balance.

The annual limit for Direct PLUS Loans is the cost of attendance minus any other financial aid received.

Repayment

Repayment of Direct Subsidized, Unsubsidized and Graduate PLUS 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 estimator.

Repayment for a Direct Parent 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 Parent 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.