Loans

Otero College offers Federal Direct Stafford Loans and offers financial counseling to students taking out student loans to ensure their understanding of the obligations and responsibilities associated with the repayment of student loans.

Please keep in mind, student loans are available to help offset educational expenses. You should exhaust all other resources of financial assistance, including scholarships, state grants, and campus employment, before applying for a student loan. Read through the information below and contact the financial aid office for further details or any questions.

Student Loan Repayment & Financial Literacy Services

Otero College has teamed up with Solutions at ECMC to answer all of your student loan repayment questions. Solutions at ECMC is a non-profit organization dedicated to helping students manage educational loans and their resources are available to you free of charge.

To contact a Solutions Student Loan Repayment Advisor, email or web chat, or call them at 1-877-331-3262.

Federal Direct Stafford Loans

There are two kinds of Federal Direct Stafford Loans: subsidized and unsubsidized. Both have the following in common:

They are low-interest loans that must be repaid by the student (visit Federal Student Aid for the current interest rates on these loans).
Origination fees are not to exceed 1.5% of the loan, which will be subtracted from each semester’s payment.
Loans are to be used for education-related expenses such as tuition, fees, books, living costs, transportation, and childcare.
- Can NOT be used to purchase a vehicle.
Must be repaid once you graduate or if you take fewer than 6 credits per semester (half-time status).
First-time borrowers of Stafford Loans are subject to a 30-day hold on their first loan disbursement.

Differences between Subsidized and Unsubsidized:

Subsidized:
- Loans remain interest-free while you are enrolled in at least 6 credits in a degree-seeking program (undergraduate or graduate).

Unsubsidized:
- Loans accrue interest while a student is enrolled in school and during the repayment period.

Federal Direct Stafford Loan Eligibility Requirements:

Have a completed FAFSA with all required documentation submitted.
Be enrolled in a financial aid-eligible degree and/or certificate program and taking 6 or more credits.
Meet or exceed Otero’s Satisfactory Academic Progress policy. (Maintain 2.0 GPA or higher, and a 67% completion rate or higher.)

Loan Application Process

Otero College has now joined the Federal Direct Loan Program. Follow the steps below to begin the loan application process:

Entrance Counseling: If you are a first-time borrower or switching to Direct Lending you must complete Entrance Counseling (EC) before you can receive any loan funds. Please go to this Loan Entrance Counseling Guide for more information on Entrance Counseling, what it is, and what you need to know. The link for the EC on studentaid.gov is within this packet. After you have completed your Entrance Counseling, Otero’s Financial Aid office will be notified.
Completing Master Promissory Note: All students using Direct Lending must complete a Master Promissory Note (MPN); please visit studentaid.gov, where you will complete this form. Otero’s Financial Aid office will receive notification once you have completed this process.
Accept Loan Offer: Please contact your financial aid office for more information and instructions.
- There is a deadline towards the end of each semester for when you can accept your loans for that specific semester.

Exit Counseling

If you receive your loan from the Direct Loan Program you are required to go online to studentaid.gov and complete Exit Counseling when you graduate, leave school, or fail to enroll in at least 6 semester credit hours. Please read through this Exit Counseling Guide for important information regarding this process. Loans must be repaid after you graduate, leave school, or fail to enroll in at least 6 semester credit hours.

How to Spot a Student Loan Scam

They make you pay up-front fees (which is illegal).
They charge monthly fees.
They promise immediate, total loan forgiveness.
They ask for your FSA ID (username and password).
They ask you to sign and submit a written agreement giving them permission to make loan decisions on your behalf.
They claim their offer is limited, so you must "act now!"
Their ads, emails, and communications contain spelling or grammatical errors.

How to Avoid Student Loan Forgiveness Scams

Emails will come from:

noreply@studentaid.gov
noreply@debtrelief.studentaid.gov
ed.gov@public.govdelivery.com

Be cautious about any calls you receive about your student loans.
Official texts from Federal Student Aid are sent from 227722 and 51592.
Double check URLs and email addresses to make sure they match exactly.

Federal Parent PLUS Loan

This loan is available to parents of dependent students who wish to borrow funds to assist with their child’s education. Parents may borrow up to the cost of attendance per child (minus other aid). For more information on this loan process, review the Parent PLUS Loan Application included in the ‘Additional Financial Aid Documents’ section at the top of the page. You will need to apply through studentaid.gov as well as turn in a paper application to the Otero financial aid office.

PLUS Loans:
- Parents apply each academic year and are approved or denied based on their credit history.
- Visit Federal Student Aid for the current interest rates on PLUS loans.
- Origination Fee: 4.288% of the loan.
- Available Repayment Plans: Standard Repayment, Extended Repayment and Graduated Repayment.

Private Education Loan

Otero College has partnered with Sallie Mae to offer a private education loan, which is a loan provided by a private lender and is not a form of Title IV funding. Private education loans are expressly for postsecondary education expenses.

Students should complete their FAFSA before applying for a private education loan to see if they are eligible for Title IV funding first.
Private education loans are usually credit based and students may need a co-signer if they decide to apply.
Any aid received, including a private loan, cannot exceed a student’s cost of attendance for the period of enrollment.

For more information on loans, and where to find these forms, please visit studentaid.gov.