Private Education Loans
Students are encouraged to apply for all scholarships, Federal grants and Federal loans for which they are eligible before considering a private education loan, sometimes called an alternative loan. Terms and conditions for Federal student loans may be more favorable than those of private education loans.
Private education loans allow students to borrow in their own name, without any government guarantee. The loans are based on the borrower's credit, and it is often beneficial to have a credit-worthy co-signer. Since these are not governmental loans, the lender assumes more risk and may charge a higher interest rate, larger loan fees, or have more stringent credit requirements than the federal loan programs. Private loans cannot be combined with federal loans if a student wishes to consolidate his/her loans after graduation.
Applying for a Private Education Loan
- Determine your priorities. Consider what aspects of a loan are most important to you, such as credit and co-signer requirements, co-signer release, interest rates, fixed or variable interest, fees, enrollment criteria, repayment terms, and borrower benefits such as a discount or rebate for paying through auto debit.
- Research & compare your options. Look at several lenders and loan products to determine which one best meets your needs. (See next section for information on selecting a lender.)
- Submit your application. Once you have decided which loan to apply for, go to the lender's website to complete the application. NMC's school code for loans is 006404.
- During the application process, you will be required to complete a Private Education Loan Applicant Self-Certification form. Section 2 of that form will ask for your cost of attendance and estimated financial assistance for the loan period. To obtain those figures, either refer to your award letter or contact your financial aid counselor.
- Follow up promptly. If you are pre-approved for the loan, the lender will instruct you on any additional steps that you need to complete. Be sure to respond promptly to any request from your lender.
- Wait. Now it's our turn. Once the lender has received everything it needs from you it will notify NMC that the loan is ready to certify. After you have registered for classes, we confirm your eligibility and enrollment, and submit the certification to the lender. At that time, we will send you a revised Award Letter showing the loan amount that was approved.
- Receive final disclosure. After NMC certifies your loan, the lender is required to send you a final disbursement disclosure informing you of your right to cancel the loan. After providing that disclosure, the lender is required to wait at least 6 days before sending your funds to the school.
Selecting a Lender
Selecting a lender for a private loan is an important decision. The loan programs differ, so it is important that you know the terms and conditions of the loan as well as your rights and responsibilities as a borrower. Students (and families) are encouraged to research the lender benefits, customer service and other information related to loan processing, services and cost. Remember that a loan is a debt that must be repaid, so it is recommended that students borrow wisely and no more than is necessary.
To assist in the comparison and selection process, NMC provides a Preferred Lender List on ELM Select. These lenders were chosen based on the quality of products and services provided. In selecting our preferred lenders we considered several factors: competitive interest rates, low or zero origination fees, borrower benefits such as co-signer release and interest reductions during repayment, stability and reputation, and quality of customer service. As the borrower, it is your right to select a lender not on this list. NMC will process your application for any eligible lender you select.
Click here to access NMC's Preferred Lender List. Remember, you are not required to select a lender from our list. You have the right to select any lender you wish, that offers this type of loan.
Code of Conduct
Educational institutions that participate in Federal Title IV programs are required to publish a code of conduct related to private education loans. This code of conduct applies to all Nebraska Methodist College (NMC) employees, officers and agents of the College, including without limitation individuals who are employed in the Financial Aid Office or who otherwise have responsibilities with respect to education loans. This code of conduct reflects NMC's commitment to conduct business and administer financial aid programs with integrity, in the interest of students, and in compliance with applicable law.
- Ban on revenue-sharing agreements - The College will not enter into any revenue-sharing agreement with any lender. The College will not accept fees, revenue, or material benefits from any lender in exchange for recommending the lender or loan products to students.
- Ban on gifts - NMC employees with financial aid responsibilities may not solicit or accept any gift or other item with a monetary value of more than a de minimus amount from a lender, guarantor, or servicer of student loans.
- Prohibited consulting and contracting arrangements - No NMC employee or agent with financial aid responsibilities shall accept from any lender or affiliate of any lender any fee, payment, or other financial benefit (including the opportunity to purchase stock) as compensation for any type of consulting arrangement or other contract to provide services to a lender or on behalf of a lender.
- Ban on limiting a borrower's choice of lender - NMC employees will not direct first-time borrowers to a particular lender through award packaging or other methods, nor will NMC employees refuse to certify or delay certification of any loan based on the borrower's selection of a particular lending institution.
- Prohibition on offers of funds for private loans - NMC will not request or accept from any lender any offer of funds to be used for private education loans in exchange for a certain number or volume of loans, or in exchange for placement of the lender on a preferred lender list.
- Ban on staffing assistance - NMC will not request or accept from any lender any assistance with call center staffing or financial aid office staffing, unless specifically allowed by federal regulation. Examples of allowable assistance include professional development training, educational counseling materials, financial literacy materials, or debt management materials for borrowers, provided that such materials disclose the identification of the lender; or short-term, nonrecurring staffing assistance to assist the institution with financial aid-related functions during emergencies or natural disasters.
- Ban on advisory board compensation - Any NMC employee with financial aid responsibilities, and who serves on an advisory board, commission, or group established by a lender, must not receive anything of value from the lender, except for reimbursement of reasonable expenses incurred in serving on the board.