Loan Counseling & Application Process

Loan Application Process

To complete the student loan application process you must:

  1. Complete a  Free Application for Federal Student Aid (FAFSA).
  2. Receive an Award Letter from NCC indicating your loan eligibility.

If you have met these two conditions and you want to apply for a student loan, please complete the final steps located within MyPlace under Student Loan Information.

Parent PLUS Loan Application Process

The Direct PLUS Loan Program is for the parents of dependent students enrolled at least half-time. This loan is available to a parent to supplement their child’s financial aid package (up to the cost of attendance).

A parent pursuing a PLUS loan must complete the following two steps:

  • Complete the PLUS Loan Authorization Form (LAF), indicating the amount they want to borrow and the school term(s):
  • Complete the PLUS Application & Loan Agreement (MPN). You, the parent, must log in with your FSA ID that was used to sign the student’s FAFSA.

View/print instructions prior to completing the application or promissory note.

NOTE:  When a student or parent requests a Direct Loan or PLUS Loan, the loan information is submitted to the National Student Loan Data System (NSLDS) and is accessible by guaranty agencies, lenders, and schools who are authorized users.

Loan Facts

  • Your Award Letter will indicate the maximum amount of loan eligibility, but you may not need to borrow the maximum. The amount you borrow is influenced by how much you receive from financial aid sources (e.g. grants, scholarships, work study) and how much you will contribute from your own resources (both student and/or parent). Be a responsible borrower. Only borrow what you can realistically repay once you are out of college.
  • You must begin repaying your Direct Loan six months after you graduate or drop below half-time. We can help you estimate your payments. Your payments will include all accrued interest and deducted fees. Making small payments while in school will help reduce your principal and/or interest balance. Remember, your loans are not grants. They are borrowed money that must be repaid. Borrow only what you need.
  • More information on financial aid planning is available at I Have a Plan–Iowa. There you will find budget calculators, a scholarship database, and tools for building a financial aid plan.
  • Before a student can receive his or her first loan disbursement, the U.S. Department of Education requires student borrowers to attend Entrance Counseling. The counseling session provides the borrower with important information regarding their rights and responsibilities. Once you have successfully completed the session, your results will be sent to the Northwest Iowa Community College Financial Aid Office. Please print a copy of the results for your own records.
  • The average federal student loan debt of borrowers at NCC is approximately $5,300 per academic year.
  • If your enrollment status drops below half-time, your future loan disbursements may be cancelled; you will no longer qualify for an in-school deferment of your loan payments; and you will either enter into repayment or start your grace period. Northwest Iowa Community College considers half-time enrollment to be 6 credits in each of the the fall, spring, and summer terms. During a grace period you are not required to make payments, but the unsubsidized interest will continue to accrue.
  • Please understand that interest accrues on Unsubsidized (and PLUS) loans and is capitalized during periods when the interest is not paid by you, the borrower. If you allow the interest to be capitalized, you will be charged interest on interest when the loans enter repayment. You have the option to pay the interest while in school; it is in your best financial interest to do so.
  • If you need to withdraw from your classes, you must see your Advisor to complete a “Withdrawal Form.” You will also need to call or stop by the Financial Aid Office. If you drop below half-time, withdraw, or graduate, you are required to complete an Online Exit Counseling session.
  • Detailed federal loan information is available on the National Student Loan Data System (NSLDS). This website outlines the federal loans you received when attending NCC and other institutions.

Entrance Counseling

If you are a new borrower to NCC and requesting a student loan, you must complete Direct Loan Entrance Counseling before NCC can disburse your loan.

If you have left NCC and are now returning, you are considered to be a new borrower.

Entrance Counseling will help you understand:

  • What a Direct Loan is and how the loan process works
  • How to manage your education expenses
  • Other financial resources that can help pay for your education
  • Your rights and responsibilities as a borrower

Exit Counseling

If you borrowed a Student Loan while attending NCC and you are now graduating, or have withdrawn or dropped below half-time, you are required to complete the Online Exit Counseling session. The average annual indebtedness for students who borrowed Federal student loans while attending Northwest Iowa Community College during the 2022-2023 academic year was $5,015.

It takes approximately 30 minutes to complete your exit counseling. If you end the session before completing, it will not allow you to begin where you left off so make sure you have all the requested information before you begin:

  • Your FSA ID (username and password)
  • Your driver’s license number
  • Name, address, telephone number of your expected employer
  • Name, address, and telephone number of a Parent or Next of Kin
  • Names, addresses, telephone numbers of two references. The two references cannot reside at the same address.

You can also view the tutorial on How to Complete Exit Counseling below.

Other Important Information

Direct Subsidized Loan Changes Effective July 1, 2013

Effective July 1, 2013, Federal law restricts the benefits of the Direct Loan subsidy to a limit of no more than 150% of a student’s program length (measured in academic years) for new borrowers. (A new borrower is an individual who has no outstanding balance on a Direct Loan or on a FFEL Program loan on July 1, 2013, or on the date the borrower obtains a Direct Loan after July 1, 2013.) Once that limit has been exceeded, a student may borrow only unsubsidized loans and will begin to incur interest charges on outstanding subsidized loans. For example, a student enrolled in a two year program will have three years’ worth of subsidized loan eligibility (150% of 2 years=3).

Because the maximum eligibility period is based on the length of the student’s current program of study, the maximum eligibility period can change if the student changes to a program that has a different length. If a student receives Direct Subsidized Loans for one program and then changes to another program, the Direct Subsidized Loans received for the earlier program will generally count toward the student’s new maximum eligibility period.

The U.S. Department of Education will undertake the tracking responsibilities to determine when the subsidy limit has been reached, inform schools of a borrower’s subsidy usage, and notify borrowers when the limit has been exceeded. The borrower becomes responsible for accruing interest during all periods as of the date the borrower exceeds the 150% limit.

Grace Period Interest Subsidy Reinstated

Borrowers of subsidized Stafford Loans first disbursed on or after July 1, 2014 are once again eligible for an interest subsidy during the 6-month grace period. The subsidy during the grace period had been temporarily removed by the fiscal year 2012 budget bill for loans first disbursed on or after July 1, 2012, and before July 1, 2014.

Help with Resolving a Problem or Dispute

It is important to keep all of your student loan papers and correspondence for your records. If you have a problem with a federal student loan, you should contact your loan holder or loan servicer to try and resolve the problem. If you are unable to resolve the problem on your own, you may contact the Federal Student Aid (FSA) Ombudsman for assistance. The FSA Ombudsman works with federal student loan borrowers to resolve loan disputes or problems from an impartial, independent viewpoint. You can reach FSA Ombudsman at:

FSA Ombudsman Group
P.O. Box 1843
Monticello, KY 42633
Toll-free telephone:877-557-2575