Like almost everywhere else, Nebraska is a state where student loans are often necessary for college. In fact, according to the Institute for College Access and Success, 61% of students attending public or private four-year institutions in Nebraska graduate with debt. The average balance is $26,585.
So, if you need help paying for school, where can you turn? And when you’re done with your education and ready to enter the workforce, how can you refinance your Nebraska student loans?
This guide will help you figure out how to pay for school in Nebraska — and how to save money when you finish.
Apply for federal student loans
Your first step for getting Nebraska student loans is filling out the Free Application for Federal Student Aid (FAFSA). This form allows you access to student loans originated by the federal government.
As a dependent student, you can borrow between $5,500 and $7,500 a year with these loans, depending on how long you’ve been in school.
There are two main types of federal student loans available to undergrads:
- Unsubsidized federal loans: Interest begins accruing as soon as the money is disbursed. You can either pay the interest while you’re in school or have it added to your loan balance when you start repayment.
- Subsidized federal loans: The government pays your interest while you’re in school and during the six-month grace period after you leave school. You must demonstrate financial need to qualify for subsidized loans.
Information from your FAFSA is sent to the Nebraska schools of your choice. After reviewing your application, each school will make a financial aid offer, including your federal loan package.
Federal loan rates are set by Congress each year, and the current rate for undergraduate student loans is 4.45%.
“Federal loans generally have more generous interest rates and come with a wider variety of payment options,” said David Bakke, a personal finance expert with financial education website Money Crashers. “It makes more sense to focus first on federal loans — then look at private loans.”
One of the advantages of federal loans, according to Bakke, is the fact that there are no credit or income requirements. Any American citizen attending a qualified higher education institution qualifies.
Parent PLUS Loans for Nebraska students
If you can’t get enough money for school using Nebraska student loans on your own, you might be able to get help from Parent PLUS Loans. These are federal loans a parent can take out to pay for college on your behalf.
These loans come with a 7.00% interest rate and require at least one of your parents to fill out a FAFSA and submit to a credit check.
Your parents might be willing to take on some of this debt. According to Discover Student Loans, 61% of parents are “very or somewhat likely” to help their children repay student loans.
On the other hand, your parents might not be able to be among the 59% of parents who pay some or all of the debt they incur to help their children pay for college. In that case, you might need to turn to other options for getting the loans you need to attend school.
Private Nebraska student loans
When you reach the limit for borrowing with federal loans, it’s time to look elsewhere, suggested Joe DePaulo, CEO and co-founder of College Ave Student Loans.
“That’s when private loans can be the right next step for some undergraduate students and their families,” he said.
It’s possible to get a low private student loan rate if you have good credit. However, many undergrads have a hard time meeting the credit and income requirements that come with private loans. In some cases, it’s possible to put off repayment until after you finish school, although interest accrues while you’re in college.
DePaulo recommended looking for private student loans that come with flexible repayment options. “These can help you match your monthly payments to your budget, whether you start paying back the loans while you’re in school or you can wait until you graduate,” he said.
If you can’t qualify for private student loans on your own, you might be able to find a cosigner. A parent who’s reluctant to take out a PLUS Loan might be willing to help you get a private loan instead.
Short-term Nebraska student loans
If you’re in a bind and need to meet emergency education-related education expenses, some Nebraska schools offer short-term loans of up to $1,000.
For example, as of April 17, 2018, the University of Nebraska-Lincoln (UNL) offers such a loan with an APR of 9.00%. In order to qualify for this loan, you have to meet the following requirements:
- Be a U.S. citizen or permanent resident
- Be registered at least half time at the school
- Have a minimum GPA of 1.5
- Not be a full-time employee of UNL
These short-term loans must be repaid within two to three months of receiving the loan or before graduation — whichever comes first.
Nebraska Rural Health Student Loan Program
If you’re in a health profession and willing to work in a shortage area, you could be eligible for low-interest loans offered through the Nebraska Rural Health Student Loan Program. Students must be Nebraska residents and must be in one of the following training programs:
- Physician assistant
- Graduate-level mental health
You can get up to $30,000 in loans through this program. The loans are forgivable when you agree to practice in a shortage area designated by the state for one year for every year you receive a student loan through this program. You must work the equivalent of 40 hours per week and accept Medicaid patients.
Other student loan repayment assistance programs are also available.
Refinancing Nebraska student loans
After you graduate, it’s time to think about repaying your student loans. Depending on your situation, it might make sense to refinance your Nebraska student loans to a lower interest rate.
A lower rate — along with a lower monthly payment — can save you money and improve your cash flow. Our student loan refinancing calculator can help you determine your savings.
Each lender has its own credit and income criteria. Some require you to have a high credit score and good income before they’ll agree to refinance your loans. Others, such as Earnest, don’t have credit and income minimums.
You can refinance federal and private student loans. You don’t have to combine them all, though, if doing so isn’t right for you. For example, I consolidated my federal loans into one loan and then refinanced my private loans. You can choose which loans to refinance so you get the greatest benefit out of the situation.
Depending on your income, there are times it makes sense to get on an income-driven repayment (IDR) plan instead. Only federal loans are eligible, but an IDR plan can cap your payments at a percentage of your income each month, giving you some breathing room in your budget.
How to reduce your need for Nebraska student loans
If you don’t like the idea of borrowing to pay for school, you can reduce your need for student loans.
“Prospective students should begin to save as much money of their own to help defray the cost of college,” said Bakke. “Additionally, working a part-time job while in school is a great strategy to cut down the student loan balance due by the time you graduate.”
It also makes sense to apply for scholarships. Even if you’ve already started school, it’s possible to find scholarships for current college students. DePaulo also pointed out that grants you don’t need to repay are available.
“Look at all sources of funding,” DePaulo said. “A successful college funding strategy often includes multiple ways to pay.”
Student Loan Hero has independently collected the above information related to short-term student loans. UNL has neither provided nor reviewed the information shared in this article.
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|2 Important Disclosures for College Ave.
College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
(1)All rates shown include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. Variable rates may increase after consummation.
(2)This informational repayment example uses typical loan terms for a freshman borrower who selects the Deferred Repayment Option with an 8-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 7% variable Annual Percentage Rate (“APR”): 96 monthly payments of $179.28 while in the repayment period, for a total amount of payments of $17,211.20. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.
(3)As certified by your school and less any other financial aid you might receive. Minimum $1,000.
Information advertised valid as of 5/29/2019. Variable interest rates may increase after consummation.
* The Sallie Mae partner referenced is not the creditor for these loans and is compensated by Sallie Mae for the referral of Smart Option Student Loan customers.
3 = Sallie Mae Disclaimer: Click here for important information. Terms, conditions and limitations apply.
4 Important Disclosures for Discover.
5 Important Disclosures for SunTrust.
Before applying for a private student loan, SunTrust recommends comparing all financial aid alternatives including grants, scholarships, and both federal and private student loans. To view and compare the available features of SunTrust private student loans, visit https://www.suntrust.com/loans/student-loans/private.
Certain restrictions and limitations may apply. SunTrust Bank reserves the right to change or discontinue this loan program without notice. Availability of all loan programs is subject to approval under the SunTrust credit policy and other criteria and may not be available in certain jurisdictions.
©2019 SunTrust Banks, Inc. SUNTRUST, the SunTrust logo and Custom Choice Loan are trademarks of SunTrust Banks, Inc. All rights reserved.
* Offer valid for new Custom Choice Loans for which applications are submitted for a credit decision between 12:00:00am EST on June 1, 2019 and 11:59:59pm EST on August 31, 2019. A 0.50% interest rate reduction will be included in the loan options presented to an applicant during the online application process, upon passing the initial credit review. The interest rate reduction will be applied as of the first disbursement date and will be effective for the life of the loan.
6 Important Disclosures for LendKey.
7 Important Disclosures for CommonBond.
A government loan is made according to rules set by the U.S. Department of Education. Government loans have fixed interest rates, meaning that the interest rate on a government loan will never go up or down.
Government loans also permit borrowers in financial trouble to use certain options, such as income-based repayment, which may help some borrowers. Depending on the type of loan that you have, the government may discharge your loan if you die or become permanently disabled.
Depending on what type of government loan that you have, you may be eligible for loan forgiveness in exchange for performing certain types of public service. If you are an active-duty service member and you obtained your government loan before you were called to active duty, you are entitled to interest rate and repayment benefits for your loan.
A private student loan is not a government loan and is not regulated by the Department of Education. A private student loan is instead regulated like other consumer loans under both state and federal law and by the terms of the promissory note with your lender.
If your private student loan has a fixed interest rate, then that rate will never go up or down. If your private student loan has a variable interest rate, then that rate will vary depending on an index rate disclosed in your application. If the interest rate on the new private student loan is less than the interest rate on your government loans, your payments will be less if you refinance.
If you don’t pay a private student loan as agreed, the lender can refer your loan to a collection agency or sue you for the unpaid amount.
Remember also that like government loans, most private loans cannot be discharged if you file bankruptcy unless you can demonstrate that repayment of the loan would cause you an undue hardship. In most bankruptcy courts, proving undue hardship is very difficult for most borrowers.
8 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|3.99% – 11.98%2||Undergraduate, Graduate, and Parents|
|4.50% – 11.35%*,3||Undergraduate and Graduate|
|4.84% – 11.99%4||Undergraduate and Graduate|
|3.27% – 10.80%5||Undergraduate and Graduate|
|4.46% – 9.43%6||Undergraduate and Graduate|
|3.74% – 9.72%7||Undergraduate, Graduate, and Parents|
|3.99% – 11.64%8||Undergraduate, Graduate, and Parents|