8 options for student loan forgiveness for nurses
You likely became a nurse because of your interest in science and desire to help others. Or perhaps you’re examining nursing schools with an eye toward a career in that field.
Unfortunately, a nursing education comes with a hefty price tag. The cost can range from $4,000 for an associate degree in nursing to above $150,000 for an advanced degree. Other factors adding to the cost include in-state vs. out-of-state institutions, public vs. private schools and where your coursework takes place.
While you earned that degree and are now likely working in your chosen field, you could also be facing years of student loan debt repayment. You may avoid this through one of multiple student loan forgiveness programs. These exist to help nurses like you reduce the repayment period by wiping out a part or all of your student debt.
What is student loan forgiveness?
Depending on the degree and the educational institution, the price tag of a nursing education can range from $11,950 to $61,080 per year. If you were like most nursing students, you relied on loans to cover those costs.
Student loan forgiveness, also called student loan cancellation or loan discharge, refers to programs that help eliminate some or all of your student debt. Many programs require you to work in areas that lack healthcare professionals. This might include offering your skills to medical clinics in underserved areas, military service or jobs with qualifying non-profit agencies.
Each loan forgiveness program has a specific set of rules, so review everything before beginning the application process.
Pros and cons of loan forgiveness
A loan forgiveness program offers various advantages and disadvantages to consider before starting this path.
Pros
- Faster debt payoff: A forgiveness program can eliminate or erase what you owe
- More financial control and security: You have more financial resources to put toward savings or other goals
- Positive credit score: Paying down — or off — a loan can be one way to improve your credit rating
Cons
- Forgiveness isn’t guaranteed: As many of the programs are highly competitive, your application might not be accepted
- Limited career paths: Due to some loan requirements, you could work in geographical areas and for employers where advancement or promotions aren’t guaranteed
- Stringent requirements: For instance, you need to work for a certain number of years with a qualified employer
Nursing loan forgiveness programs
Multiple options are available for forgiving or reducing nursing school loans.
Public Service Loan Forgiveness (PSLF)
Public Service Loan Forgiveness (PSLF) is the most common type of student debt forgiveness plan. Through this program, your Direct Loan debt from nursing school could be forgiven if you:
- Have made 120 monthly payments under an income-driven repayment (IDR) plan.
- Work full-time for a qualifying employer, usually government agencies and 501(c)(3) non-profit organizations.
One obvious advantage to this plan is that it helps reduce what you owe. Another benefit is that the amount forgiven isn’t taxed at the federal level.
The U.S. Department of Education (ED) offers a PSLF Help Tool to determine your eligibility for the program. It also provides additional actions to apply for this debt relief program.
Nurse Corps Loan Repayment Program
The Nurse Corps Loan Repayment Program (NCLRP) is available through the Health Resources and Services Administration (HRSA).
If you qualify, the program could pay off up to 85 percent of your nursing education debt as long as you meet one of the following criteria:
- You’re a registered or advanced practice registered nurse or nurse practitioner who received your degree from an accredited U.S. nursing school.
- You’re a nurse faculty member teaching at an accredited U.S. nursing school with qualifying nursing debt.
The NCLRP requires you to work for at least two years in a critical shortage facility (CSF). A CSF is a public or private healthcare facility in or serving a Health Professional Shortage Area (HPSA). If you’re a nurse instructor, the NCLRP requires that you teach at an eligible nursing school.
This is also a highly competitive program. According to the Bureau of Health Workforce, 2,071 initial awards were made in 2022 out of 5,419 applications received. NCLRP awards aren’t exempt from federal income taxes.
National Health Service Corps Loan Repayment Program
The HRSA also oversees the National Health Service Corps Loan Repayment Program (NHSC LRP).
You could qualify for loan repayment assistance through this program if you work at an NHSC-approved site in an HPSA for at least two years. Once your two-year stint is completed, you can apply for additional one-year continuation service contracts and pay down the student debt until it disappears. However, there’s no guarantee you’ll be awarded that continuation contract.
Your likelihood of receiving help through the NHSC LRP depends on that HPSA and its score. A higher score means a greater need for medical services. Available funds vary yearly, and awards are issued until funding runs out.
The program is open to nurse practitioners involved with primary care medical, behavioral and mental health services. Certified nurse midwives practicing in maternity care areas are also included under this banner.
Program awards are exempt from federal income and employment taxes.
Perkins Loan Cancellation Program
Until 2017, the Perkins Loan Program offered low-interest rate subsidized loans to undergraduate and graduate students with extreme financial need.
Though the program no longer exists, the Perkins Loan you still owe could be canceled if you work in a public service job for at least five years. Qualifying public service jobs include military service, AmeriCorps/PeaceCorps or nonprofit agencies that assist high-risk children and families in low-income communities.
To learn more about canceling your Perkins Loan, contact the school that issued your loan or the school’s Perkins Loan servicer.
Indian Health Services Loan Repayment
The Indian Health Services Loan Repayment program (HIS LRP) can help repay your nursing education loans if you commit two years to working in a health facility serving American Indian and Alaska Native communities. The U.S. Department of Health and Human Services’ Indian Health Service division oversees this awards program.
Like the NHSC LRP, you could extend your contract yearly until your student debt is repaid. And just like the NHSC LRP, working with Indian health programs in facilities with higher-level staffing needs increases the chances you’ll receive help paying down your loans.
The program also prioritizes the greatest staffing needs in specific disciplines of the health profession. Nurses involved in family practice, psychiatry, geriatrics, pediatrics and women’s health are eligible for this program.
While you don’t have to be an American Indian or Alaska Native to apply for this program, these categories receive priority consideration, all other factors being equal (including site scores and staffing requirements).
Disadvantaged Faculty Loan Repayment Program
If you are a registered nurse, advanced practice registered nurse or nurse faculty member and come from a disadvantaged background (based on economic or environmental factors), you could be eligible for the Disadvantaged Faculty Loan Repayment Program.
The program is under the HRSA’s purview. To qualify, you must complete a two-year commitment at an approved, accredited health professions school in a state or U.S. territory.
Like other HRSA programs, you can apply for extended contracts after completing your two-year term. While the repayment award is taxable, you could receive a tax liability benefit equal to 39 percent of the repayment amount.
State-level loan forgiveness
In addition to the available federal programs that can help discharge all or part of your loan, many states are willing to help you. These programs can vary based on eligibility, residency, specialty area and work commitment.
Some examples include:
- Alaska’s SHARP program
- California’s State Loan Repayment Program
- Kentucky’s State Loan Repayment Program
- Oregon’s Partnership State Loan Repayment Program
- Texas’ Rural Communities Health Investment Program
- West Virginia’s State Loan Repayment Program
The list above is just a sample of what’s available. To learn more, visit the website of the state you’re targeting.
Military loan forgiveness
There are various loan forgiveness programs for nurses serving in the military. The Navy offers a Health Professions Repayment Program, while the Army has similar programs for active-duty members. Programs are also available If you’re considering serving in the Air Force or are a reservist or veteran).
For additional information, contact your military branch to research student loan benefits.
The bottom line
A nursing degree puts you in an excellent position to help others. And thanks to various student loan forgiveness programs for nurses, you could eliminate or lower the educational debt that often comes with earning that degree.
If you find you don’t qualify, there are other options. You could refinance your loan or enroll in an income-driven repayment plan; either option can help reduce your debt payments. Another possibility is to take a job as a travel nurse. This path could give you a competitive salary and free housing, allowing you more money to pay down your educational debt.
The takeaway is that there is a way out of the debt you accrue while studying to become a nurse. Any of the paths mentioned in this article can help you pay down (or eliminate) loans and provide greater financial freedom while helping you attain your personal goals.
