Several jobs offer loan repayment programs that pay off some or all of your debt in exchange for your service. Almost all programs apply to federal loans, not private.
As of 2018, there are 1.3 trillion dollars in outstanding student loan debt in America. This staggering number highlights the financial struggle that many people face when pursuing an education. Whether you currently feel the weight of your own student loan debt, or are just beginning to embark on the (harrowing) borrowing process, learning about loan forgiveness provides valuable information that may alleviate some stress.
Public Service Loan Forgiveness Program (PSLF)
Under the PSLF program, your Direct Loans may be forgiven after you have made 120 qualifying monthly payments toward your student loan debt while working full-time for a qualifying public service or nonprofit employer. There is no cap on how much debt can be forgiven, but you only qualify for PSLF after you have made 10 years of repayments through an income-driven repayment plan.
Teachers, lawyers, healthcare professionals, members of the military and professionals in many different fields avail themselves of this program.
Healthcare Foregiveness Options
There are several loan repayment programs available for professionals in the health field such as doctors and nurses, as well as mental health clinicians, pharmacists and dentists.
National Health Service Corps (NHSC) Loan Repayment Assistance Program
This program awards up to $50,000 to primary care doctors, dentists, nurse practitioners, mental health nurse practitioners, certified nurse midwives, psychiatric nurse specialists and mental health care providers who work for at least two years at a site that is in a Health Professional Shortage Area.
The Students to Service Loan Repayment Program
Also offered through the National Health Service Corps (NHSC), this program provides up to $120,000 for students in their last year of medical school or dental school who commit to three years of service as a primary care provider at an NHSC-approved site.
Indian Health Service Loan Repayment Program
The IHS LRP offers qualifying health care providers up to $40,000 in repayment of eligible health education loans in exchange for a two-year service commitment to practicing in a facility that serves American Indian and Alaska Native communities.
NURSE Corps Loan Repayment Program
Program benefits nurses who work in underserved areas in Critical Shortage Facilities (CSFs) in Health Professional Shortage Areas, or in any eligible school of nursing. The program offers debt relief in exchange for three years of full-time employment. It pays up to 60% of your loan balance if you serve for two years, and an additional 25% if you serve for a third year, for a total of 85%.
Health Resources and Service Administration Nurse Faculty Loan Program (NLFP)
The NFLP is a loan for advanced education nursing students who plan to be nurse faculty, which means they plan to teach nursing. To be clear, this is not only a loan forgiveness program, but also a legitimate loan that covers two semesters of costs for tuition, software, books and fees. Between 20% and 80% of the loan is forgiven in exchange for working as nurse faculty full-time for one to four years.
Health Resources and Service Administration Faculty Loan Repayment Program
The HRSA FLRP offers $40,000 in repayment assistance to nurses and other health care professionals who come from a disadvantaged background (either economically or environmentally) and commit to serving as faculty in a Health Professions School for a term of two years.
National Institutes of Health (NIH) Loan Repayment Programs
These are a set of programs designed to recruit and retain health care professionals into biomedical or biobehavioral research career tracks. They repay up to $35,000 annually of a researcher's educational debt in return for a commitment to conduct NIH mission-relevant research.
Military Repayment Options
The military does not just offer repayment plans for health care professionals, but also for its other service members and veterans as well. The Army and Navy’s loan repayment programs offer up to $65,000 in total aid. Multiple programs are available, so visit each military branch’s websites for more details.
Repayment Options For Lawyers
John R. Justice Student Loan Repayment Program (JRJ SLRP)
JRJ SLRP provides loan repayment for state and federal public defenders and state prosecutors who commit to at least three years of work in this area. The benefits are $10,000 maximum per year, but cannot exceed $60,000 overall. Attorneys with the greatest financial need are given priority.
Department of Justice Attorney Student Loan Repayment Program (ASLRP)
Attorneys who work for the Department of Justice may be eligible for the ASLRP, which gives up to $6,000 per year, with a maximum amount of $60,000. In order to qualify, lawyers must commit to three years of service with the Department of Justice.
Herbert S. Garten Loan Repayment Assistance Program
Through a lottery system, this program offers loan repayment rewards for attorneys who work for Legal Service Corporation and its grantees. LSC is a nonprofit that provides legal civil services to low-income Americans. The program gives $5,600 to approximately 70 eligible attorneys each year.
Air Force Judge Advocate General’s Corps Loan Repayment Program
Lawyers who join the Air Force Judge Advocate General’s Corps program (known as JAG) could receive up to $65,000 total in loan repayments. JAG officers deal with all legal matters in the U.S. military. After your first year of service as a JAG officer, you will collect the payments over a three-year period.
Teacher Loan Forgiveness Program
Under the Teacher Loan Forgiveness Program (TLFP), if you are a special education, secondary math, or science teacher, you could be eligible for forgiveness of up to $17,500 of your Direct Subsidized and Unsubsidized loans and Subsidized and Unsubsidized Federal Stafford Loans. Teachers of other subjects are eligible for up to $5,000 of forgiveness of these loans. You may be eligible for forgiveness under the TLFP if, among other things, you have been employed as a highly qualified teacher for five complete, consecutive academic years at a school or educational service agency that services lower-income students.
State Loan Repayment Programs and Employer Loan Repayment Programs
Almost all states offer loan repayment programs, usually for those who work in public service. Visit your state’s website to find out if you qualify for an available program.
Some employers offer loan repayment plans and/or will help pay for you to receive an advanced degree. Be sure to ask your Human Resources department about any student loan aid your company might provide.
Income-Based Repayment Programs
You can use income-based repayment (IBR) options for both private and federal loans. These are not loan forgiveness programs; they are repayment plans that base payments on your actual income. With IBR, maximum monthly payments are 10-15% of your income over 20-25 years. After the 20-25 years, the remaining balance will be forgiven.
Revised Pay as You Earn (REPAYE) is an IBR that caps monthly payments at 10% of your income for 20 years. After 20 years, the remaining balance will be forgiven.
In an Income-Contingent Repayment Plan, monthly payments are capped at 20% of your discretionary income or what your payment would be on a fixed, 12-year payment plan—whichever is less. Balances are forgiven after 25 years if you make steady payments.
Note that loan forgiveness is not the same thing as loan discharge, which is when circumstances beyond the borrower’s control prohibit repayment. Some reasons for discharge may be death, permanent disability, or closure of a school while the borrower is attending it.
Be sure to read each program’s terms and eligibility requirements thoroughly, and note whether the rewards are taxable or accrue interest. Getting an education can be expensive, but these programs can do much to offset some of the costs of pursuing your goals.