New in 2002-2003

This is a NEW program. The first awards will be made in the 2002-2003 academic year. It is currently funded at $450,000 a year.

Students must:

• Be a Wisconsin resident.
• Be enrolled at least part-time.
• Be enrolled at an eligible in-state school in:
  A program that confers an associate degree in nursing.
  A program that confers a bachelor's degree in nursing.
  A program that confers a 2nd degree that will make the person eligible to sit for a state licensing examination.
  A program that confers a diploma in nursing.
  
• Agree to be employed as a nurse in Wisconsin.

Other Specifics

• Open to undergraduate students.
• The minimum award is $250 with an annual maximum of $3,000. The overall program maximum is $15,000.
• For each of the first two years the student practices nursing full-time, 25% of the loan is forgiven. If the student does not practice nursing full-time, the amount forgiven will be proportional to the time spent nursing (If the student nurses 50% of the time, then half of 25% will be forgiven).
• This is NOT a full forgiveness program. The maximum forgivable amount is 50% of what was borrowed.
• The interest rate will not exceed 5%.
• If the student does not nurse and/or meet the eligibility criteria, the loan(s) must be repaid.
• The program is a need-based program. HEAB is having the students complete a FASA and are working with the school's financial aid office to determine cost of education and if the student is eligible for any need-based grant or scholarship aid. This is to keep the amount of loan money the student may need to borrow to a minimum and minimize the possibility of a large repayment burden.

For further information contact:

Alice Winters, Nursing Student Loan Program Coordinator by phone at (608) 267-2213 or by e-mail at alice.winters@heab.state.wi.us.

HEA 15.01 Purpose. To define the various aspects of the Nursing Student Loan Program authorized by s. 39.393, Stats., as created by 2001 Wis. Act 16 as to the awarding of the loans; their forgiveness; or their repayment.

HEA 15.02 Definitions.

1. "Board" means the Higher Educational Aids Board

2. "Eligible institution" means a non-profit, private institution of higher education in Wisconsin, which is accredited by a national or state accrediting agency, and which provides:
   1. a program that confers an associate degree in nursing;

   2. a program that confers a bachelor's degree in nursing;

   3. a program that confers a 2nd degree that will make the borrower eligible to sit for examination under s. 441.04 or 441.10 or

   4. a program that confers a diploma in nursing.

3. "Forbearance" means an extension of time for making loan payments or the acceptance of smaller payments than were previously scheduled.

4. "Grace Period" means a six-month period following withdrawal or graduation during which the borrower is not responsible for interest or payment.

5. "Loan" means a loan made under the Nursing Student Loan Program.

HEA 15.03 Borrower Eligibility.

1. The borrower shall be a resident of the United States, either a citizen or an alien lawfully admitted for permanent residence by the Federal Immigration and Naturalization Service.

2. The borrower shall be a Wisconsin resident as determined by the board using the residency standards of s. 36.27, Stats.

3. The borrower shall be enrolled at least half-time in an eligible institution in a program as defined in HEA15.02 (2).

4. The borrower shall be required to show financial need.

5. To the extent possible, preference shall be given to persons who are enrolled in either the second year of a 2-year associate degree nursing program; the third year of a 3 year nursing diploma course; or in the junior or senior year of a bachelor degree program.

HEA 15.04 Terms of Loans.

1. Eligible borrowers shall receive a minimum annual award of $250. The maximum annual award shall not exceed $3,000. The exact amount of the award shall not exceed the borrower's cost of education, as determined by the eligible institution using recognized federal methodology, minus the need-based aid the borrower is offered. Loans for students that are need-based may be replaced in the package of aid by the Nursing Student Loan. The total the borrower receives under this program shall not exceed $15,000 in outstanding principal.

2. For the portion of the loans that are not forgiven but must be repaid, the interest rate shall not exceed 5% annually on the unpaid principal balance with accrual beginning upon the initial date of repayment. Interest shall not accrue during periods of at least half-time enrollment; grace period; employment that qualifies for forgiveness; or during board authorized periods of deferment from repayment. The interest rate shall be determined annually by the board.

3. The initial date of repayment shall be determined by the board in each instance beginning no sooner than six months after the borrower withdraws or graduates from the eligible institution. There shall be a six-month grace period that will start the day after the person withdraws or graduates from the eligible institution. The borrower shall not be required to make payment during the grace period.

HEA 15.05 Application Process.

1. A borrower seeking a loan shall contact the eligible institution's financial aid office.

2. The eligible institution's financial aid office shall determine the borrower's cost of education within the requirements set by the board, shall determine the borrower's financial need based on federal methodology and determine nursing loan student loan eligibility based on borrower eligibility under this program. The board shall decide if the borrower shall receive a loan under this program.

3. The eligible institution's financial aid office shall notify the board of the loan amount for the borrower. The board shall determine if the borrower shall receive a loan under this program. The board shall issue a check for the borrower's loan after the borrower's signed agreement form has been received by the board.

4. All borrower contact concerning forgiveness and repayment shall be with the board. After leaving school the borrower shall maintain written annual contact with the board until the loan is either forgiven or repaid. The borrower is required to forward all name, address and telephone number changes to the board.

HEA 15.06 Loan Forgiveness.

1. Loans shall be forgiven when the borrower is licensed and employed, at least half-time, in Wisconsin as a nurse. For the first academic year of full-time employment, 25% of the principal and accrued interest, if any, shall be forgiven, with the amount to be prorated in cases where less time has been worked. For the second academic year of full-time employment, 25% of the principal and accrued interest, if any, shall be forgiven, with the amount pro-rated in cases where less time has been worked. The borrower shall be given a maximum of 4 years to work the required 2 years for partial forgiveness.

2. The maximum of 4 years allowed for forgiveness shall be extended by the board for up to a total of 2 years for approved periods of deferment, as referenced in HEA 15.08. In no instance shall the term of forgiveness exceed 6 years including periods of deferments authorized by the board. The executive secretary may allow additional periods of deferment in exceptional situations.
3. Loan principal remaining unforgiven either because the forgiveness period as defined in subs. (1) and (2) is over, or because the borrower has not been employed for forgiveness as defined in sub. (1) or has moved out of state, shall be repaid to the state of Wisconsin with interest accrued from the date on which the forgiveness period ended.

4. Only borrowers holding a license in nursing shall be eligible for forgiveness.

5. No interest shall be charged the borrower during the forgiveness period.

HEA 15.07 Terms of Repayment.

1. Borrowers shall repay a loan if not employed, at least part-time, as a nurse in the state. Repayment shall be required of borrowers who are employed for periods of time but who do not complete their forgiveness within the time allowed.

2. Once the borrower has reached the expiration of the forgiveness period or the borrower has reached 50% forgiveness, the repayment period shall begin immediately.

3. The monthly payment shall be a minimum of $50 including principal and accrued interest. Accrued interest shall be paid first each month from the payment received. The board shall determine the monthly repayment schedule, although a borrower may request a schedule with a higher monthly payment.

4. A borrower shall repay the loan within a maximum of 13 years not counting periods of deferment granted by the board. Interest shall not accrue during periods of deferment authorized by the board.

5. Borrowers may prepay any or all of their loan account without penalty whether the borrower is in school, forgiveness, repayment or deferment.

6. If the borrower dies or becomes totally and permanently disabled, all obligation to make any further payment of principal and interest on the loan shall be canceled.

HEA 15.08 Deferment of Loan Repayment for Borrowers.

1. Borrowers who return to school on a full-time basis in any course of study at an accredited institution shall be deferred by the board from repayment for the period of enrollment.

2. Borrowers who are on active duty in the military shall be deferred by the board from repayment for the period of their active duty, not to exceed to 3 years.

3. Borrowers, who enter the Peace Corps or Volunteers in Service to America, shall be deferred by the board from repayment for the term of their active service, not to exceed 3 years. Employment with similar private agencies is eligible for deferment, as determined by the executive secretary, if the agency is federally tax exempt.

4. Borrowers who are unemployed shall be deferred from repayment by the board for up to 6 months at a time, up to a maximum of 24 months, as long as they provide proof, satisfactory to the board, of actively seeking employment.

5. Borrowers who become pregnant, give birth or legally adopt a child shall be deferred from repayment by the board for up to 12 months.

6. In order to receive a deferment, a borrower shall apply to the board. If the borrower submits written evidence, which verifies eligibility for the deferment, the board shall approve the deferment.

7. The board may grant forbearance from repayment for the benefit of the borrower. The board may grant forbearance whenever unemployment, health, other personal problems, or educational study that is ineligible for deferment temporarily affects the borrower's ability to make scheduled payments on the loan. Periods of forbearance may not exceed 6 months for each approved request, up to a maximum total of 24 months.

HEA 15.09 Applicability. Administrative rule HEA 15 shall apply to all loans made since the inception of the program.