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 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 https://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 first disbursed during the period of July 1, 2018, through June 30, 2019, is fixed at 5.05% 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 first disbursed during the period of July 1, 2018, through June 30, 2019, is fixed at 5.05% annually for undergraduate students and 6.60% 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, 2017, and before Oct. 1, 2018, the fee is 1.066%. For loans first disbursed on or after Oct. 1, 2018 and before Oct. 1, 2019, the fee is 1.062%.

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, 2018, through June 30, 2019, is 7.60% 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 https://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 https://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, 2017, and before Oct. 1, 2018, the fee is 4.264%. For loans first disbursed on or after Oct. 1, 2018, and before Oct. 1, 2019, the fee is 4.248%.

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 UndergraduateIndependent UndergraduateGraduate
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. For example, if you are enrolled in a two-year program, you could have no more than three years of eligibility; and for a four-year program, you could have no more than six years of eligibility. 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 Health Resources and Services Administration (HRSA) of the U.S. Department of Health and Human Services.

Nursing Student Loans (NSL) are available to students enrolled in an undergraduate Nursing program. To qualify, students must have financial need as determined by the FAFSA; be enrolled at least half-time; be of legal age in their state of residence; and must not be in default on any student loan nor have an adverse credit history. After being credit-approved, the borrower must complete online entrance counseling, acknowledge truth-in-lending disclosures, and sign an online promissory note. Eligibility must be re-established each academic year.

The maximum annual award amount is $3,300, except during the last two years of the program the annual limit is $5,200. The aggregate limit for all years of study is $17,000.

This is a loan and it must be repaid, even if the borrower does not complete the degree. Interest, at the rate of 5.0% per year, begins to accrue 9 months after the borrower ceases to be enrolled at least half-time. Repayment also begins 9 months after the borrower's last date of enrollment at least half-time. The amount borrowed, plus accrued interest, is repayable over a 10-year period. Payments are due no less than quarterly, and a minimum payment or $40 per month or $120 per quarter is required.

Once the repayment period has begun, a borrower may qualify for periods of deferment for service as a Peace Corps Volunteer, active duty member of a uniformed service, or while enrolled at least half-time in a baccalaureate or graduate level nursing program, pursuing advanced professional training in nursing, or training to become a nurse anesthetist.   

Nurse Faculty Loans (NFLP) are available to students enrolled in an advanced education nursing program who are committed to become nurse faculty upon graduation from the program. The purpose of the NFLP program is to increase the number of qualified nursing faculty. Loans are provided to assist with educational expenses and, in exchange for full-time, post-graduation employment as nurse faculty, the program authorizes cancellation of up to 85% of the NFLP loan. 

To qualify for the NFLP a student must be enrolled in an eligible program that prepares the individual to become nurse faculty. Eligible programs at NMC include the Doctor of Nursing Practice (DNP), the MSN-Nurse Educator, RN to MSN-Nurse Educator, and the Post-Master's Certificate-Nurse Educator.  In addition, the recipient must be in good academic standing; committed to completing the program of study and serving as full-time nurse faculty for 4 consecutive years at an accredited school of nursing following graduation from the program; a U.S. citizen or national of the U.S., or a lawful permanent resident of the U.S. and its territories; and have no judgment liens entered against his/her property for default on a federal debt, 28 U.S.C. 3201(e).

To be considered for the NFLP program, an applicant must submit the Free Application for Federal Student Aid (FAFSA) each academic year. Annually, after eligibility is confirmed, the borrower must complete online entrance counseling, acknowledge truth-in-lending disclosures, and sign an online promissory note.

The NFLP loan covers the cost of tuition, fees and books while a student is enrolled part time or full time. Loans may not exceed $35,500 for an academic year and no more than 5 years of support. Funding is limited to one advanced degree.

This is a loan and it must be repaid, even if the borrower does not complete the program of study. Interest begins to accrue 3 months after the borrower graduates or ceases to be enrolled in an eligible program of study. The interest rate will be 3% per year for borrowers who graduate and fulfill their full-time 4-year teaching obligation. For borrowers who do not graduate, do not obtain full-time employment or do not complete the entire 4-year service agreement, interest will accrue at the prevailing market rate. This prevailing market rate is determined by the U.S. Treasury Department and has ranged from 9.75% to 10.75% in recent years. 

Repayment begins 9 months after the borrower graduates or otherwise ceases enrollment in the eligible program of study, and the loan must be repaid within 10 years. During periods when the borrower is employed full-time to qualify for the cancellation, payments may be postponed but this does not extend the repayment period. 

To qualify for the loan cancellation, full-time employment must be obtained within 12 months of graduation. Upon documented completion of each the first, second and third years of eligible employment, 20% of the loan will be cancelled. Upon documented completion of the fourth year of eligible employment, 25% of the loan will be cancelled. Therefore, after 4 consecutive years of eligible full-time employment, 85% of the loan will have been cancelled. The borrower is then responsible for repaying the remaining 15% of the loan over the remaining 6 years of the repayment period.

NFLP borrowers may be eligible for deferment for up to 3 years when ordered to active duty as a member of a uniformed service, or when a borrower who graduates and is employed decides to return to a graduate nursing education program to further their preparation as a nurse faculty.

For more detailed information about the NFLP program, please download this document about the NFLP that was produced by the NMC Financial Aid Office. Among other things, it includes specific information about documentation and deadline requirements to establish eligibility for the loan cancellation.