Paying for college is something that many Nebraska families struggle with. The majority of families are not able to pay for the costs of college without some sort of financial assistance. There are a couple of different forms of financial assistance available to help pay for college, with the most common sources being education grants or scholarships and loan programs.
The terms are sometimes incorrectly used interchangeably. While all the programs have the same purpose of helping students pay for college, they accomplish this purpose in very different ways. Scholarships are awarded to students based on their academic achievements. Most scholarships require students to write an essay or complete some other sort of project in order to qualify. Grants are available based on needs, usually financially based.
Loans are the most different of the two. Grants and scholarships do not need to be repaid, but loans do. Loans have varying payment plans based on the type of loan and how much is borrowed. Many loans have an option available called loan forgiveness. Through loan forgiveness, select students do not have to pay a portion or even sometimes the full payment of a loan, but only if they meet certain conditions. The following is a brief overview of the more popular student aid in Nebraska.
FAFSA stands for the Free Application for Federal Student Aid. Any student that is interested in receiving any form of educational financial aid must complete a FAFSA application. The FAFSA program does not provide any financial aid themselves, but the program is used as a general application for all the programs that do provide financial assistance. Essentially, the purpose of FAFSA is to act as a hub for educational financial aid, letting applicants know exactly which programs they are eligible for. Both students and schools benefit from using FAFSA, since it greatly reduced the number of documents they are required to keep track of, and overall it helps to simplify the aid application process. It also helps with replying for future grants or scholarships, since all the information is already saved in the system.
The one downside to FAFSA has to do with dates. FAFSA has their own dates that they use, but many finance programs as well as schools have their own deadlines they use. As such, students are encouraged to use FAFSA as early as possible to see what they are eligible for and pay close attention to the due dates on any grants or loans they are interested in.
Nebraska Pell Grant
The Pell Grant is a federal loan that is available for low-income students. There are a couple of different factors which determine how much a student can receive from the federal Pell Grant. How long they are planning to attend school, whether or not they are full time students, the overall cost of tuition and the total expected family contribution all have an impact on how much the grant can provide. It is not uncommon for the total amount available from the Pell Grant to increase in future years to reflect the rising cost of college tuition, so future applicants may end up being eligible for more through the grant. One of the best features of the Pell Grant is that the money received does not have to be repaid, unless the student drops out of school. The FAFSA application is used to apply for this grant.
Nebraska Opportunity Grant (NOG)
NOG is available to Nebraska residents who are attending a postsecondary institution within the state. NOG is provided by the schools directly, so eligible students must check with the college to see whether or not the NOG is actually available. Like the Pell Grant, the amount provided by NOG varies depending on the financial and academic needs of the student. On average, students receive between $1,000 and $1,200 dollars. This is subject to annual change.
Types of Nebraska Loans
Loans are divided into two categories, subsidized and unsubsidized. Interest on subsidized loans is paid by the U.S. Department of Education, but are only available to students that show financial need. How much a student can borrow is determined by the school. Unsubsidized loans are available to any students, but how much a student can borrow is still determined by the school. Students are responsible for paying any interest on the loan. Both types require the student to begin paying back the loan after he or she has left school.
Nebraska Perkins Loan Program
Perkins loans in Nebraska are a special type of loan available to low-income students. Through a Perkins loan, the school acts as the lender for the funds, and the loans always have a fixed interest rate of five percent. This is subject to change, annually. Only select Nebraska schools accept the Perkins loan program. The Perkins loan has a loan forgiveness option available for students that go on to teach full-time at a low-income school or an area with a teacher shortage. Many opportunities exist in different industries to offer loan forgiveness in exchange for service in challenged areas.