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How Nurses Can Receive Loan Forgiveness

Robin Hill-Gray - Author
By

Jan. 2 2022, Published 7:09 p.m. ET

When it comes to student debt, nearly 50 million Americans owe $1.57 trillion. The average college graduate owes $39,351 in federal loans, with 52.8 percent being Stafford loans. For nurses, the median debt is $54,999. Is loan forgiveness available?

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Salary projections for registered nurses are above $60,000, and the median salary is $68,450. The average licensed vocational nurse (LVN) and licensed practical nurse (LPN) make $42,500 and $44,000, respectively. Even though salary projections are high for nurses, student debt affects many. Here are four ways nurses can receive loan forgiveness.

Federal Perkins loan forgiveness

Federal Perkins loans were given to low-income undergraduate and graduate students. Though Perkins loans are no longer available, those who received one can still qualify for loan forgiveness. If a nurse has worked for at least five years as a full-time nurse, they may qualify for loan forgiveness.

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To get a Perkins loan forgiven, you should contact your school or loan provider. If you received the loan because of high financial need, you may be able to get up to 100 percent of your loan forgiven. Loans can be forgiven in increments over five years, and those increments are typically tax-free.

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Public service loan forgiveness

Nurses who work for a non-profit hospital or health organization are eligible for public service loan forgiveness. For this type of forgiveness, however, 120 payments are required first. Private loans aren't eligible. Nurses are encouraged to pursue income-driven payments to keep monthly payments low and to have more debt forgiven.

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Both registered nurses and nurse practitioners are eligible for this loan forgiveness. According to a former loan servicer for Nelnet, public loan “dominates any repayment strategy" for nurses. The Public Service Loan Forgiveness Help Tool is available for nurses seeking more information on qualifications and the application process.

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Nurse Corps loan repayment program

The Nurse Corps loan repayment program is available for registered and advanced practice nurses. To qualify, nurses are required to work full time for two years as a nurse faculty member at an eligible nursing school or in a facility with a high nursing shortage.

The program works by repaying up to 60 percent of federal and private loans. An additional 25 percent is available for nurses who work an additional year on top of the two required. Nurse will also have to pay taxes on money from the corps program.

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National Health Service Corps loan repayment

The National Health Service Corps (NHSC) program is similar to the Nurse Corps program. However, a nurse cannot be in the NHSC loan repayment program and the Nurse Corps program at the same time. The NHSC program is available to both full-time and part-time nurses who have federal and private loans. After working for two years in a high nurse shortage area, they can have their loan repaid. Part-time workers must work a minimum of 20 hours a week for 45 weeks.

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Full workers can have loans up to $50,000 forgiven, and part-time workers can have up to $25,000 forgiven. Taxes aren't paid for this program. Nurse practitioners, certified nurse-midwives, and psychiatric nurses are encouraged to apply. The NHSC also provides a substance use disorder workforce loan repayment program, which provides $75,000 to nurses who work full time for three years, and $37,500 for part-time nurses.

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State-specific loan repayment

State-specific loan repayment is available for nurses who reside in certain areas, such as Georgia, Maryland, and Washington. In Georgia, registered and advanced nurses can work full time in underserved areas and receive $10,000 per year. The contracts are also renewable.

Nurses who attended school and worked in Maryland can receive $10,000 if they work full time for a government agency or non-profit medical organization for low-income individuals. Nurses who make more than $60,000 a year are ineligible. In Washington, nurses who work full time for three years at eligible companies can qualify for $75,000 in loan repayment assistance.

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