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Student Loan Forgiveness For Nurses: What You Need To Know

By David Krug David Krug is the CEO & President of Bankovia. He's a lifelong expat who has lived in the Philippines, Mexico, Thailand, and Colombia. When he's not reading about cryptocurrencies, he's researching the latest personal finance software. 6 minute read

In 2014, a study showed that there were nearly three million nurses in the United States. The medical field is one that is continually growing and evolving, and there will always be a great demand for those in the nursing field. And while going to school to become a nurse can be accomplished in as little as two to four years, there is still a lot of student loan debt following those around who graduate with a nursing degree. Fortunately, though, student loan forgiveness programs do exist that can be of immense help to those who graduate nursing school with loan debt. Let’s take a look at the various forgiveness options and the benefits they can bring to you.

Student Loan Forgiveness for Nurses

Hospital Tuition Reimbursement

First and foremost, the number one tip to follow when seeking student loan forgiveness for nurses is to know where to look for relief. Many people who graduate with a nursing degree and find employment fail to ask their employer about financial debt assistance. With this in mind, you should start your job search by first seeking employment through a hospital or medical facility that offers some type of tuition reimbursement program. You may be able to have the entirety of your student debt paid for by an employer. This, many times, in itself is worth taking a lower-paying position. The only drawback to this type of loan forgiveness program is that you will likely have to sign a contract stating you will stay employed through that specific employer for a period of two to five years. Still yet, the loan forgiveness benefit is still worth signing the contract because, on average, nursing graduates graduate with loan debt totaling $30,000.

Military Debt Forgiveness Programs

Another place to look when seeking loan forgiveness for nurses is the military. There are several branches that offer nursing school tuition debt assistance as long as you will agree to serve a certain number of years in the military. If you have a passion for serving your country, becoming a nurse and entering a branch of service very well could provide you with a two-fold benefit.

Nurse Corps Loan Forgiveness Program

The Nurse Corps Loan Forgiveness Program won’t pay off all of your student loan debt, but it does provide the possibility of paying off 85 percent of the debt. This program recruits those who have gone through the necessary training to become a registered nurse as well as those who are already employed as a nurse. The recruitment process strives to find nurses who are willing to work in health care facilities that are undergoing a shortage of nurses. If you agree to work in one of these facilities for a period of two years, 60 percent of student loan debt will be paid for. If you put in another year of employment through one of the facilities, an additional 25 percent of your debt will be covered. This means if you graduate with $30,000 in student loan debt, you could have as much as $25,500 of the debt paid for you through the Nurse Corps Loan Forgiveness Program.

Public Service Loan Forgiveness

If you find employment as a nurse in a public sector job, a portion of your loans may qualify for forgiveness. You will, however, have to make at least 10 years worth of consecutive payments first. You will also have to be employed on a basis in which you work at least 30 hours a week. It is important to keep in mind that the lower-paying you job you have as a nurse, the lower your monthly qualifying payments will be. The higher-paying job you have, the higher your monthly payments will be, meaning you very well may pay off all of your student loan debt during the 10 years in which you have to make payments. Still yet, this will be based on the total overall amount of student loan debt you have. One of the top benefits to having your debt forgiven through the Public Service Loan Forgiveness program is that the forgiven debt is not considered taxable income like it is with the forgiveness that takes place through the income-driven plan.

Federal Perkins Loan Cancellation and Discharge

This program applies only to those nurses who paid for their schooling with a Federal Perkins Loan. If other loans were used to pay for the schooling, the Federal Perkins Loan will still qualify for forgiveness, but the other loans will not. The top benefit to this forgiveness program is that 100 percent of the loan debt accrued under the Federal Perkins Loan will qualify for forgiveness. To meet the criteria for forgiveness, you will need to work as a registered nurse on a full-time basis, and your debt will be forgiven over a period of five years. If you are just now going to school to earn a degree in nursing, you won’t be able to pay for your schooling with a Federal Perkins Loan because the program expired on September 30, 2017; however, for any funds that were acquired through this program before this date, forgiveness is still available through the Federal Perkins Loan Cancellation and Discharge program.

State Forgiveness Program Options

Depending on where you live and find employment as a nurse, there may be state-specific programs in place to help you with your student loan debt. Take Arizona for example. If you work in this state as a nurse, you can take advantage of the Arizona Loan Repayment Program, which provides tuition reimbursement assistance to those who work either on a full- or part-time basis for at least two years. The program is incredibly generous, providing up to $50,000 in reimbursement for each year you are employed. Kentucky is another state that generously helps out nursing graduates. Nurse practitioners working in the state who agree to work for at least two years in a Health Professional Shortage Area can receive anywhere from $20,000 to $40,000 in student loan debt assistance.

Three Must-know Tips for Qualifying for Student Loan Forgiveness for Nurses

1) You have to have the right type of loan(s)

If you go to college and have your schooling paid for through private student loans, you are not going to qualify for any type of forgiveness programs. Under the Public Service Loan Forgiveness program, your loans must have been acquired through the Federal Direct program or the FFEL loan program. There is a good chance, however, that your loans came through the Stafford program or as a Perkins loan. If so, there is good news, You can consolidate these loans using the Federal Direct Consolidation Loan program, and they will then qualify for the Public Service Loan Forgiveness program.

2) You have to have the right type of employment

Depending on the exact forgiveness program you are seeking loan relief through, you will have to meet certain criteria, with most programs mandating that you acquire employment in a public sector job that serves areas that are underserved. Because of this, it is crucial that you make sure your job meets the criteria for obtaining forgiveness.

3) You may have to pay back part of your student loan debt

Lastly, many forgiveness programs for nurses will still require you to pay back a portion of your debt. Take for example if you are on the income-driven repayment plan. You will still have to make at least 25 years worth of payments before the remaining debt is forgiven. So, even if your monthly payment is only $100, after 25 years of making this consecutive payment, you will have paid off $30,000 of your loan. If your debt is larger than this amount, then the remaining will be forgiven. The point is, though, that most forgiveness programs will require you to make anywhere from 10 to 25 years worth of payments before forgiveness kicks in.

The Takeaway

There are a variety of programs to take advantage of when it comes to having your student loan debt for nursing forgiven. To help make sure you take advantage of the best one for you, it is advised that you research each program. Here is a list of the best forgiveness programs for 2018-2019.

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