New Mexico Student Loans
New Mexico is a vibrant southwestern state with a rich heritage and memorable landscapes. The flagship institution of the state, the University of New Mexico, (UNM) is nestled in the heart of the bustling city of Albuquerque, with unique architecture paying homage to the nearby Pueblo Indian villages which are very near the banks of the famous Rio Grande river. A Carnegie Research Institution that is one of the only Hispanic-serving Institutions with the distinction of Very High Activity, UNM provides its students with a variety of highly ranked programs and fields of study.
Getting its start as a land-grant institution, New Mexico State University (NMSU) prepares students to become productive members of society through a variety of educational options. Where new meets old and innovation blends into the Old West, NMSU is located in sunny Las Cruces, New Mexico, which is home to a plethora of outdoor and recreational opportunities year-round.
Of all of the 81 Southwestern public institutions, Eastern New Mexico University (ENMU) in Portales, New Mexico, is in the top 10 percent of lowest tuition options. With over 60 programs to choose from and several online degree options, ENMU provides students seeking higher education with many different choices. Western New Mexico University boasts small class sizes and over 70 diverse fields of study, with a sprawling main campus in beautiful Silver City, New Mexico, which is surrounded by the Gila National Forest.
Students at the New Mexico Highlands University (NMHU) fulfill their educational goals at the main campus in Las Vegas, New Mexico, or at one of the centers located in Espanola, Albuquerque, Roswell, Rio Rancho, Santa Fe, or Farmington, New Mexico. Rural and Native American communities are served by the main campus of Northern New Mexico University (formerly Northern New Mexico College) in Espanola, which may be one of the most affordable colleges in the state.
Residents of New Mexico pay in-state tuition rates at local schools, which are generally much lower than out-of-state rates. New Mexico resident and non-resident students alike have several options to help pay for college.
Gift Money vs. Loans
The two main forms of student financial aid come either in the form of free, or gift, money that doesn’t need to be repaid or loans that do need to be repaid. Free money options include scholarships and grants, which may be awarded based on academic merit, financial need, or other specific criteria as outlined by the granting organization.
There are many scholarship options for both resident and non-resident students attending schools in New Mexico, and the financial aid office at your chosen school may have more information on these programs. Most scholarships require a separate application and may have a variety of eligibility requirements. To be eligible for federal or state-based financial aid and/or grants, students will need to complete the Free Application for Federal Student Aid (FAFSA), which uses a student’s financial information in order to determine aid eligibility.
Federal grants may be offered if a student demonstrates financial need. Federal grants include the Federal Pell Grant and the Federal Supplemental Education Opportunity Grant (FSEOG) programs. The Pell Grant may provide eligible undergraduate students with up to $5,815 a year for the 2016-2017 academic school year. Students with extreme financial need may qualify for between $100 and $4,000 a year in FSEOG funds, which may be limited and only offered at participating schools. FSEOG awards are considered campus-based aid since the school disburses funds directly based on a first-come, first-served basis.
State-based grants in New Mexico are meant to help residents of the state afford college. The College Affordability Grant is for resident students enrolled at least half-time at a New Mexico public university, college, or tribal college and may provide up to $1,000 a semester to eligible students. The College Affordability Grant is for students who do not meet the necessary criteria for other state scholarship or grant programs. Undergraduate resident students enrolled at least half-time in a public or private non-profit college or university in New Mexico who demonstrate extreme financial need may qualify for between $200 and $2,500 a year in funds through the Student Incentive Grant Program.
New Mexico Student Loan Options
When grants and scholarship monies are not enough to cover the full cost of college expenses, students (or the parents of dependent undergraduate students) may take out a student loan. The U.S. Department of Education is the lender for federal loans, which are borrowed through the Direct Loan Program. Students with financial need may take out a Federal Perkins Loan. Not all schools participate in the Perkins Loan Program, which is a federal loan wherein the individual school will actually be the lender. It is offered to students with extreme financial need, with a low and fixed interest rate of 5 percent. Eligible students may borrow $5,500 a year as an undergraduate student, up to a total of $27,500, while graduate students may borrow $8,000 a year, up to an aggregate amount of $60,500, which includes undergraduate Perkins Loan amounts. Your financial aid office will have more information on what types of loan programs they participate in.
Other federal loans that are offered through the Direct Loan Program include Direct Subsidized and Direct Unsubsidized Loans, Direct PLUS Loans, and the Direct Consolidation Loan. Subsidized means that the government helps cover interest payments, and these are offered on the basis of financial necessity. Unsubsidized loans do not hinge on financial considerations. These loans can be combined.
Dependent undergraduate students may borrow a total of $5,500 in Direct Subsidized and Unsubsidized Loans for their first year of college, with no more than $3,500 coming from subsidized loans. Each subsequent year in college (up to the third year) sees these amounts increasing $1,000 each year, with a loan maximum of $31,000, with up to $23,000 coming from subsidized loans. Independent students may borrow more each year from the Direct Loan Program, with amounts starting at $9,500 for the first year, increasing to $10,500 for the second year of college, and increasing again to $12,500 for the third year and beyond. Aggregate loan limits for independent students are $57,500 for undergraduate students.
Graduate and professional students may borrow Direct Unsubsidized Loans in amounts of $20,500 per year, up to a total of $138,500, with no more than $65,000 coming from subsidized loans. Parents of dependent undergraduate students and professional or graduate students may borrow up to the full cost of attendance through a Direct PLUS Loan, which, unlike other federal loans, does require a credit check and decent credit scores to obtain.
Students sometimes borrow funds through more than one loan program and may be able to combine loans and loan payments through a Direct Consolidation Loan.
Actual amounts students may borrow will be determined by the school as total cost of attendance minus other financial aid is calculated before funds are awarded. Students should only borrow what they need, and amounts cannot exceed the total cost of attendance
Supplemental educational loans are available from outside sources and often termed alternative, or private, student loans. The New Mexico Educational Assistance Foundation (NMEAF) provides the New Mexico Student Loan option to both resident and non-resident students enrolled in a college in New Mexico at least half-time. This loan requires a credit check, and students may need a co-borrower in order to qualify. The New Mexico Student Loan offers students funding amounts between $1,000 and $20,000 a year, up to cap of $100,000 in a fixed-interest rate supplemental loan, with three different repayment options. Your school will determine how much funding you can actually receive through this loan by factoring in your total cost of attendance and other financial aid you may receive.
Generally speaking, federal students loans are the safest bet and offer the best interest rates and repayment options for student borrowers. They should be fully considered before seeking out private student loans.
- Teacher Education Assistance for College and Higher Education (TEACH) Grant: This federal program provides prospective teachers who agree to teach for four years in a low-income, high-need field after college up to $4,000 a year to pay for education to pursue a career in teaching.
- Teacher Loan for Service Program: New Mexico residents with financial need who are pursuing a teaching career may receive up to $4,000 a year for up to five years to fund their education.
- Teacher Loan Repayment Program (TLRP): This provides funds to repay student loans for certified New Mexico resident teachers teaching in (or declaring intent to teach in) a designated high-risk teacher position located in a geographic area with a high poverty rate. Funds are variable, and priority is given to graduates of New Mexico colleges and universities.
- Medical Loan for Service Program: Resident students accepted into the UNM school of medicine, demonstrating financial need, and who agree to a term of service may borrow up to $25,000 a year, renewable for four years. Each year of completed service as a designated health professional in a shortage area post-graduation absolves some of the loan debt. If the entire service commitment is fulfilled, the loan may be 100 percent forgiven.
- Allied Health Loan for Service Program: New Mexico residents with financial need seeking certification or licensure as a physician’s assistant in an eligible health field may qualify for up to $12,000 a year (renewable for four years) that may be 100 percent forgiven if terms of service are met. A portion of the loan is forgiven for each year of service provided.
- Nursing Loan for Service Programs: New Mexico resident nursing students with financial need can apply for up to $12,000 a year, which is renewable for up to four years. It can be entirely forgiven if service commitment in a designated service area is fulfilled.
- Nurse Educator Loan for Service: Resident students accepted into a nursing program at a New Mexico public university or college can borrow up to $7,500 a year if they are employed full-time or agree to a service commitment as a full-time nurse educator at a participating institution. Loan may be forgiven entirely if terms of service are met.
- Health Professional Loan Repayment Program (HPRLP): New Mexico residents who are practicing, or agree to practice, and work as a full-time health professional in a designated health professional shortage area and who have a New Mexico Professional License as well as student loan debt, may be eligible to have up to $25,000 a year of their loan repaid depending on loan debt, funding available, and number of applicants. Those working in a Federal Health Professional Shortage Area (HPSA) may be eligible for up to $35,000 a year if the service commitment is met. The HPRLP is highly competitive, and graduates of New Mexico public colleges and universities are given preference.
- Minority Doctoral Loan for Service Program: Women and ethnic minorities with a baccalaureate degree from a New Mexico four-year public university or college pursuing a doctoral degree and agreeing to teach in a specified underrepresented field at a public New Mexico university may borrow up to $15,000 a year for up to four years in a 100 percent forgivable loan if service terms are fulfilled.
- WICHE Loan for Service Program: The Western Interstate Commission for Higher Education (WICHE) provides New Mexico residents with the opportunity to enroll in a participating out-of-state dentistry or veterinary medicine graduate or professional program not offered at a New Mexico post-secondary institution paying reduced levels of tuition and receiving funds to cover all support fees of the program. Upon returning to New Mexico to practice in their field, students may fulfill their service contract and have the loan forgiven.
- Public Service Loan Repayment Program: Those licensed to practice law in the state of New Mexico with education debt incurred during the pursuit of a legal education, employed as an attorney, or agreeing to practice, in an eligible Public Service Law position, with an annual salary not over $55,000, and who have already applied for loan forgiveness or repayment programs through their law school directly, may be eligible for up to $7,200 a year to pay off student loan debt with the fulfillment of a three-year service contract.
- John R. Justice Loan Repayment Program: Full-time eligible prosecutors or public defenders licensed to practice law and working in New Mexico may qualify for loan repayment funds of up to $8,300 a year and not to exceed $60,000 in a lifetime.
Work-study programs may be another option to help students pay for college. They provide the option to work part-time, usually on campus or within the local community, to help cover educational costs while attending school. New Mexico residents attending Dine College, St. John’s College, University of the Southwest, Southwestern Indian Polytechnic Institute, Crownpoint Institute of Technology, and the Institute of American Indian Art may be eligible for the New Mexico Work Study Program.
The Federal Work-Study Program is another form of work-study that may be available to eligible students. Work-study programs are for students with financial need, and they are another form of financial aid that will be included in the Student Aid Report (SAR) after submitting the FAFSA. Students are not guaranteed employment through this program, and they are required to apply for work-study jobs directly.