The Nursing profession in America faces a crisis today.
An estimated shortfall of more than 100,000 nurses threatens
to triple or even quadruple over the next decade. The reasons
are many, but a quick look throws up a few significant and
crucial factors: lack of well trained faculty, lack of appropriate
resources and funding, limited incentives for nursing
students, and lack of new blood in the profession. While
this grim scenario could scare some, it also opens up a window
of opportunity for others who aspire to this noble profession.
To address the crisis and spur student interest in nursing,
the country and individual states have instituted a large
range of nursing student loans with flexible options thrown
in for good measure.
Nursing aspirants can choose among different loan options
such as the Federal Nursing Loans, Perkins Loan Program, the
Stafford Loan program, the important Pell Grant loans, and
myriad state sponsored loan programs. The loans are given
to nursing students
for the completion of their course at nominal rates of interest.
The attraction of these loans lies in the fact that during
periods of deferment, the interest rates do not accrue. These
loans are available to all U.S. citizens who are enrolled
in the colleges at least half-time either as an undergraduate
or a graduate student. These loans are governed by statutory
provisions in effect at the time of granting of the loan program.
Types of Loan Programs
Students can take advice on financial loan packages form
their school's financial aid office to determine the type
of loan required. Among the gamut of loan programs available,
here are some of the more common ones.
The Federal Nursing Loan
is an important and popular program that offers around $2500
for each academic year but is restricted to freshman and sophomore
students. Junior, senior, and graduate nursing students are
eligible for a higher amount of about $4,000.
While the Perkins Loan Program is need based and provides
up to $6,000 annually for graduates, the Stafford loans are
more universal and offer up to about $23,000 for college education
and $46,000 for graduate degrees.
The federal Pell Grants are a must for nursing
students looking for financial help because of their
unique nature. These loans offer around $4,000 annually and
do not require repayment. These are aimed at undergraduate
students. The amount of grant available to an individual depends
on his/her cost of attendance, nature of the course (full-time
or part-time), and duration of course.
Individual state governments also provide a variety of loans
in a concerted effort to deal with the shortage in nursing
staff. Colleges in these states have their individual loan
programs with different stipulations and processing deadlines.
However, most of these loans are pegged at a 5% rate of interest
with repayment period of 10 years. Colleges can apply for
the Federal Family Education Loan program (FFLEP) or the Direct
Loan program. While the former is implemented and run by private
fund providers, the latter is under government control. These
programs offer a range of low interest loan programs based
on individual need. Universities of Iowa and of Minnesota
offer loan amounts up to $2,500 per each academic year, with
the amount increasing to $4,000 in the last two years.
The University of Dakota offers loans to those students who
enroll for at least half time. At the standard 5% interest
rate, the interest on these loans starts after nine months
from the time the student moves down to below ?half time student
status? or completes the course and leaves the University.
Repayment is scheduled for within 10 years and has to be made
to the University. Similarly, Villanova University students
can avail of nursing student loans at the same rate of interest
but only after they have applied under FAFSA. The State Student
Assistance Commission of Indiana (SSACI) program offers a
scholarship that can be used for tuition and fees only. The
maximum amount available annually is $5,000, but users have
to agree to basic conditions: work as a nurse in an Indiana
health care center for two years after graduation and complete
the nursing course within six years from the time the scholarship
Regulations for the repayment of loans
Students have to discuss conditions pertaining to repayment
of loan to decide on the amount to be repaid, the interest
rate, loan scheme and provisions, etc. Users have the liberty
to repay any part of the loan amount before the due date,
but generally repayment is spread over a 10 year period beginning
from the time the grace period (of nine months) ends. Repayment
of installments doesn't call for penalty and students can
avail of opportunities for the same given certain conditions.
NOTE: The grace period does not involve accrual
of interest. While these loan programs offer varied facilities,
schools are geared to award penalties if users do not make
a scheduled payment, do not pay for more than a period of
60 days, or do not provide the documents required for deferment
of payment. Deferment applies to those users who apply for
it once the period of repayment starts at the end of the grace
Criteria for deferment include: active duty
as an US uniformed service member, voluntary service with
the Peace Corps, enrollment in a minimum half-time course
in a nursing school that leads to a baccalaureate
or a graduate degree in nursing, or studying an advanced professional
training in nursing. Student nursing loan users are also eligible
for what is described as forbearance. This pertains to repayment
of loans and can be granted under certain conditions such
as extraordinary events, personal considerations, natural
disasters, etc. While the user cannot avoid paying the entire
loan amount due, s/he could avail of reduced payments, extended
time periods for repayment, or other considerations that could
make repayment less cumbersome. Loans can also be forgiven
by both federal and state governments in cases where students
commit to serve for a specified number of years within communities
facing acute nursing staff shortage.
Some terms for reference.
Accelerated payments: Payment of future
installments without any additional penalty for the same.
FAFSA: The abbreviated form for Free Application
for Federal Student Aid. Families that send their children
for such education should fill such a form at the beginning
of the year to qualify for financial aid.
Federal Pell Grant: This is a grant, not
a loan and therefore, does not require repayment.
Half Time: A minimum of six semester hours
or quarter hours for each term, or 12 semester hours or 18
quarter hours each year depending on how the school calculates