Student Loan Forgiveness for Nurses in 2018

Student loan debt is inevitable when you’re pursuing a nursing career, which is why we created the ultimate guide to student loan forgiveness for nurses to make it a lot easier. Of the many career fields that can benefit from loan forgiveness, nurses are lucky, as they have more resources than most.

This guide will cover five major nursing student loan forgiveness programs, as well as a few others because there are lots of options. You’re a nurse—you’re smart and resourceful—so we gave you lots of details to get a head start on a healthy financial future. If you’re ready to get your education or make your first step towards debt relief, then let’s get started.

What Is Loan Forgiveness?

Loan forgiveness means that the borrower of the loan, which is the person who took out the loan, is no longer required to repay all, or a portion of, the remaining principal and interest owed on the student loan.

Loan Basics 101

Principal: The total sum of money borrowed plus any interest that has been capitalized.

Interest Capitalization: The addition of unpaid interest to the principal balance of your loan.

Deferment: The temporary postponement of payment on a loan.

Forbearance: A temporary suspension of monthly loan payments.

Do Nurses Qualify for Student Loan Forgiveness?

Yes, nursing is a great profession for student loan forgiveness options. The requirements for becoming a nurse require a solid education foundation, especially since more responsibility as a nurse requires more schooling. Additionally, nurses are a cornerstone upon which our healthcare system is built, so it’s no wonder the federal government provides multiple options to help nurses relieve their student loan debt. Some of these programs apply to students across the board, considering that Americans collectively hold over $1.5 trillion in student loan debt as of 2018†, and some of them are specifically designed just for nurses.

Which Nursing Careers Are Eligible?

Eligible nursing careers depend on the loan forgiveness program requirements. As we’ll cover in the sections below, you’ll find that many programs offer assistance to registered nurses and advanced practice registered nurses. No matter your specialty, make sure your education was from an accredited school of nursing and that your license is current and without restriction. It’s key to keep in mind that there is no absolute guarantee of loan forgiveness. So, no matter what nursing career you plan to pursue, take action early by doing your research before and during your schooling and employment.
illustration of school books a graduation cap and student loans with a nurses hand accepting all of these things

Federal Student Loans Eligible for Forgiveness

Federal loans are one of the most accessible loans for students of any field. When it comes to student loan forgiveness for nurses, the federal government offer multiple types of loans. There are currently two loan programs according to the Federal Student Aid Office of the U.S. Department of Education. Let’s do a quick overview of each type.

The William D. Ford Federal Direct Loan (Direct Loan) Program: This is the largest federal student loan program, in which the U.S. Department of Education is your lender. Under this program, there are four types of Direct Loans that are available.

  • Direct Subsidized Loans are for eligible undergraduate students who demonstrate financial need to help cover the costs of higher education at a college or career school.
  • Direct Unsubsidized Loans are for eligible undergraduate, graduate and professional students, however, students are not required to demonstrate financial need.
  • Direct PLUS Loans are for graduate or professional students and parents of dependent undergraduate students to help pay for education expenses not covered by other financial aid.
  • Direct Consolidation Loans allow you to combine all of your eligible federal student loans into a single loan with a single loan servicer.

The Federal Perkins Loan Program: This school-based loan is a school-based loan program for undergraduate and graduate students with exceptional financial need, and in which the school is the lender.

The Federal Family Education Loan (FFEL) Program: This discontinued program arranged for loans to be made by banks or other financial institutions. No new FFEL Program loans have been made since July 1, 2010. Though this loan program no longer exists, FFEL loans are still eligible for forgiveness. Find more on forgiveness options below.

Federal Loan Repayment Options

The first step in the loan forgiveness process is choosing and committing to a loan repayment plan. Depending on your financial situation, there are several repayment plans available. Talking with your loan provider is the best way to know to know all of the details and if the plan is right for you. These repayment options, as described by Federal Student Aid, are available for all students in and out of the nursing field.

Standard Repayment Plan

All borrowers have up to 10 years to repay their loans at a fixed amount each month. Eligible loans include:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Subsidized Federal Stafford Loans
  • Unsubsidized Federal Stafford Loans
  • Direct Plus Loans
  • FFEL Plus Loans

Graduated Repayment Plan

All borrowers have up to 10 years to repay their loans. Payments will start out low and increase every two years, but will not be more than three times greater than any other monthly payment. Eligible loans include:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Subsidized Federal Stafford Loans
  • Unsubsidized Federal Stafford Loans
  • Direct Plus Loans
  • FFEL Plus Loans

Extended Repayment Plan

To qualify, you must have more than $30,000 of Direct Loans or more than $30,000 of FFEL Program loans to repay. Borrowers have up to 25 years to repay with your choice of fixed or graduated payments. Eligible loans include:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Subsidized Federal Stafford Loans
  • Unsubsidized Federal Stafford Loans
  • Direct Plus Loans
  • FFEL Plus Loans

Revised Pay As You Earn Repayment (REPAYE) Plan

This is for Direct Loan Program borrowers. Monthly payments will be 10 percent of discretionary income, and, if you’re married, both parties’ loan debt will be considered. Eligible loans include:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Direct Plus Loans made to students
  • Direct Consolidation Loans that do not include PLUS loans (Direct or FFEL) made to parents

Pay As You Earn Repayment (PAYE) Plan

To qualify, you must be a Direct Loan Program borrower who 1) took out a loan on or after 10/1/2007, 2) has received a disbursement of a Direct Loan on or after 10/1/11 and 3) has a required payment amount that is initially under the 10-year Standard Repayment Plan. Your maximum monthly payments will be 10 percent of your discretionary income. Your spouse’s income or loan debt will be considered if you file a joint tax return. Also, you must have high debt relative to your income. Eligible loans include:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Direct Plus Loans made to students
  • Direct Consolidation Loans that do not include PLUS loans (Direct or FFEL) made to parents

Income-Based Repayment (IBR) Plan

This is for Direct Loan Program and FFEL Programs borrowers who have a required payment amount that is initially under the 10-year Standard Repayment Plan. Your monthly payments will be 10 or 15 percent of your discretionary income, and, if you’re married, your spouse’s income or loan debt will be considered if you file a joint tax return. You must also have high debt relative to your income. Eligible loans include:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Subsidized Federal Stafford Loans
  • Unsubsidized Federal Stafford Loans
  • Direct or FFEL Plus Loans made to students
  • Direct or FFEL Consolidation Loans that do not include PLUS loans made to parents

Income-Contingent Repayment (ICR) Plan

This plan is for Direct Loan Program borrowers. Your payments will be lesser of 1) 20 percent of your discretionary income or 2) the amount you would pay on a repayment plan with a fixed payment over 12 years that is adjusted to your income. Eligible loans include:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Direct Plus Loans made to students
  • Direct Consolidation Loans (including Direct Consolidation Loans made after 7/1/06 that repaid PLUS loans made to parents)

american flag illustration indicating federal programs

Federal Loan Forgiveness Programs

The federal government has designed several options for students to eliminate a portion of their student loan debt. To be in good standing, you must make payments on time and in full, which are known as qualifying payments. Keep reading to find out if you qualify for any of these federal loan forgiveness options.

Repayment Plan Loan Forgiveness

Each repayment plan has a standard forgiveness option attached to it. The details depend on the repayment plan you chose or were eligible for. Below you will find a breakdown of the amount of time needed for making qualifying payments before the outstanding balance is forgiven, though you may have income tax on any amount that is forgiven.

Repayment plan Years of qualifying payments before forgiveness
REPAYE 20 or 25 years
PAYE 20 years
IBR 20 or 25 years
ICR 25 years

The Public Service Loan Forgiveness (PSLF) Program

The Public Service Loan Forgiveness Program forgives the remaining balance on a public service employee’s Direct Loans after you have made 120 qualifying monthly payments. You must not default on your loans, and you must be using a qualifying repayment plan while working for a qualifying employer.

  • A qualifying payment is made after 10/1/07, for the full amount due and no later than 15 days after the due date.
  • A qualifying employer means that you work for:
    • Government organization at any level (federal, state, local, or tribal)
    • Not-for-profit organizations that are tax-exempt under Section 501(c)(3) of the Internal Revenue Code
    • Other types of not-for-profit organizations that are not tax-exempt under Section 501(c)(3) of the Internal Revenue Code, if their primary purpose is to provide certain types of qualifying public services
    • AmeriCorps or Peace Corps serving as a full-time volunteer

Loans under the FFEL Program or the Federal Perkins Loan Program do not qualify, since they are not Direct Loans, but they may become eligible if you consolidate them into a Direct Consolidation Loan. Any payments made on the FFEL Program or Perkins Loans before the consolidation do not count towards the 120 qualifying loan payments.
Note that because you must make 120 qualifying payments before you are eligible for loan forgiveness, it will be at least 10 years before you can apply for PSLF. If you want to apply, you must complete and submit the Employment Certification for Public Service Loan Forgiveness form (Employment Certification form) annually or when you change employers for the government to verify that you are making qualifying PSLF payments.

Send the completed form, with your employer’s certification, to FedLoan Servicing, the U.S. Department of Education’s federal loan servicer for the PSLF Program.

U.S. Department of Education
FedLoan Servicing
P.O. Box 69184
Harrisburg, PA 17106-9184

If you wish to fax it, fax it to 717-720-1628.

If FedLoan Servicing is already your servicer, you may upload your Employment Certification form on their website.

Federal Perkins Loan Cancellation

You may hear both “loan forgiveness” and “loan cancellation” when doing your research on loan debt relief, but they typically refer to the same idea: the borrower is no longer obligated to pay back some or all of the remaining loan amount. However, loan cancellation is generally used to refer to Federal Perkins Loan Cancellation. Under this program, if you’re a nurse, you may qualify for up to 100 percent of your Perkins loans to be forgiven for eligible service.

To apply, you’ll need to contact your loan servicer. If you’re not sure who your servicer is, you can use the My Federal Student Aid portal to find out.

Nursing Loan Forgiveness by State

It’s very common for states to offer some kind of loan forgiveness for nurses, especially if your employment is within a Health Professional Shortage Area (HPSA). States will have their own rules and regulations for financial assistance, so it’s best to contact your state’s department of health to get the information you need to find out if you qualify.

Illustration of a nurse's stethoscope

Nursing Loan Repayment Programs

In addition to the federal student loan forgiveness options covered above, which are widely available to students of fields, there are programs dedicated just to nursing professionals. Here are some of the most popular ones.

NURSE Corps Loan Repayment Program

As the population grows and ages, there is an increased need for healthcare services and, therefore, nurses in our workforce. The federal government has designed a program that is designed to encourage people to pursue nursing careers by offering financial assistance to repay a portion of their qualifying student loans in exchange for full-time service at either a Critical Shortage Facility (CSF) or an eligible school of nursing, called the NURSE Corps Loan Repayment Program (NURSE Corps LRP). The program is specifically administered by the Bureau of Health Workforce in the Health Resources and Services Administration of the U.S. Department of Health and Human Services and awards funds based on the job role of the nurse.

Basic Requirements for Applicants

In order to be considered eligible for NURSE Corps Loan Repayment, make sure that you meet the following criteria.

You are a:

  • licensed registered nurse,
  • advanced practice registered nurse, OR
  • nurse faculty member with qualifying nursing debt

You received your nursing education from:

  • an accredited school of nursing located in a U.S. state or territory

You work full-time in:

  • an eligible Critical Shortage Facility in a high need area (for RNs, APNs),
  • an accredited school of nursing (for nurse faculty)

Applicants must also meet the following requirements:

  • Be a U.S. Citizen (either U.S. born or naturalized), U.S. National or Lawful Permanent Resident, and provide documentation of your status
  • Have earned a bachelor’s or associate’s degree in nursing (or equivalent degree), a diploma in nursing or a graduate degree in nursing
  • Be employed as a full-time RN or APRN while working at least 32 hours/week at a public or private non-profit CSF, or as a full-time nurse faculty at a public or private non-profit eligible school of nursing
  • Have incurred outstanding qualifying educational loans for a diploma or degree in nursing
  • Have completed the nursing education program for which the loan balance applies
  • Have a current, full, permanent, unencumbered, unrestricted license to practice as an RN or APRN in the state where you intend to practice, or be authorized to practice in that state pursuant to the Nurse Licensure Compact

There are situations that may deem you as an ineligible applicant for the program. These include the items listed below, but the full list may be found in the Application and Program Guidance document.

  • Have any judgment liens arising from a federal debt
  • Have an existing service obligation
    • These include programs, such as the National Health Service Corps Loan Repayment or Scholarship Programs, the NURSE Corps Scholarship Program, the State Loan Repayment Program, the Nurse Faculty Loan Repayment Program, the Faculty Loan Repayment Program, any state-sponsored loan repayment program, any employer-sponsored scholarship or recruitment/retention incentive programs or Active Duty military obligation, that will not be satisfied by the application submission deadline
      • One exception exists for individuals in a Reserve component of the Armed Forces, including the National Guard
    • Have defaulted on any federal payment obligations
    • Have defaulted on prior service obligation to the federal, state or local government
    • Work for a nurse staffing agency or travel nurse agency
    • Have a temporary or inactive RN license
    • Be a licensed practical nurse (LPN) or a vocational nurse
    • Be self-employed
    • Work at a private for-profit CSF or school of nursing
    • Work at a school of nursing that is not accredited by a national nursing accrediting agency or state agency

Basic Requirements for Places of Employment

Nurse Faculty

If you’re a nurse faculty member, you will be required to provide full-time service by teaching pre-licensure students, RNs or APRNs at an eligible public or private non-profit school of nursing.

What is an eligible school of nursing?

A school of nursing is considered eligible if it is accredited by a national nursing accrediting agency of a state agency recognized by the Secretary of the U.S. Department of Education. A list of these agencies can be found online.

If you’re a nurse faculty member, you must teach full-time in an eligible public or private non-profit school of nursing to receive loan payment.

RN or APRN

RN and APRN participants are required to provide full-time service at a CSF, which must be a public or private non-profit healthcare facility located in, designated as or serving a primary medical care or mental health, Health Professional Shortage Area.  Eligible healthcare facility types are as follows:

Hospitals Critical Access Hospital (CAH)
Disproportionate Share Hospital (DSH)
Public Hospital
Private Non-Profit Hospital
Outpatient Clinics Federally Qualified Health Center (FQHC)
Indian Health Service Health Center
Native Hawaiian Health Center
Rural Health Clinic
State or Local Health Department
Nurse Managed Health Clinic/Center
Urgent Care Center
Certified Community Behavioral Health Clinic (CCBHC)
Free and Charitable Clinics
End Stage Renal Disease (ESRD) Dialysis Centers
Ambulatory Surgical Center
Residential Nursing Home
Home Health Agency
Hospice Program

Ineligible facilities include, but are not limited to:

  • Clinics in prisons and correctional facilities
  • Private for-profit facilities
  • Staffing agencies and travel nursing agencies

How Are Funds Awarded?

Because NURSE Corps LRP offers loan repayment options for registered nurses (RNs) and advanced practice registered nurses (APRNs), many nursing careers are considered for fund awards. APRNs include Nurse Practitioners (NPs), Certified Nurse Midwives (CNMs), Clinical Nurse Specialists (CNSs), and Certified Registered Nurse Anesthetists (CRNAs). The appropriation of funds adheres to the following breakdown, according to job functions mentioned above:

  • 50 percent of funds are awarded to Nurse Practitioners
  • Up to 10 percent of funds are awarded to nurse faculty
  • 40 percent of funds are awarded to RNs or APRNs, excluding NPs
    • Approximately 15 percent of these funds will be used for qualified applicants working at Disproportionate Share Hospitals (DSHs) or public hospitals
    • Approximately 25 percent of these funds will be used for qualified applicants working at all other types of CSFs

Once applicants are placed in their appropriate groups, funds are awarded in order of decreasing debt-to-salary ratio until funds are completely expended. Repayment is based on an initial two-year commitment, which pays participants a total of 60 percent (30 percent/year) of outstanding qualifying loan debt as of the application deadline. For an optional third year of service (Continuation Contract), participants will be awarded an additional 25 percent of their original total qualifying education loan balance, though this additional payment is subject to availability of funds. Note that participants cannot add new loans when applying for a Continuation Contract.

Service Obligation

The two-year commitment must be of full-time service. “Full-time” at an eligible CSF means at least 32 hours/week for a minimum of 45 weeks per service year.

At an eligible school of nursing, “full-time” is defined by the employer for a minimum of nine months per service year.

Note: The NURSE Corps LRP requires verification every six months that participants are in current compliance with the service obligation.

Qualifying Loans

To qualify for the program, loans must be governmental or private (commercial) loans used for tuition and other reasonable educational and living expenses incurred while attending a school of nursing where you obtained your qualifying nursing education and while taking only nursing prerequisite courses at schools other than the school or nursing where you obtained your qualifying nursing education. If you have consolidated your loans with any other debt or with loans of another individual, the consolidated loan is not eligible. Loans that have been paid in full also do not qualify.

Nurse Faculty Loan Program

The Nurse Faculty Loan Program (NFLP) is an opportunity for accredited schools of nursing to increase the number of qualified nursing faculty. NFLP is a one-year funding program that helps these schools offer loans to students in advanced education nursing degree programs who are committed to becoming nurse faculty. Up to 85 percent of the loans used for nursing education are eligible for cancellation in exchange for full-time, post-graduation employment as nurse faculty.

To be eligible, schools must be public or private non-profit accredited schools of nursing offering educator coursework as part of an advanced education nursing degree program(s) that prepares students to serve as nurse faculty.

National Health Service Corps Loan Repayment Program (NHSC LRP)

The NHSC LRP is a program allowing licensed healthcare providers up to $50,000 toward student loans in exchange for two years of work at an NHSC-approved site. Federal loans, state loans and loans from local entities, as well as commercial institutions, qualify. There are several additional requirements for eligibility:

  • Be a U.S. citizen (either U.S. born or naturalized) or U.S. National
  • Be eligible to participate as a provider in the Medicare, Medicaid and the State Children’s Health Insurance Program, as appropriate
  • Be a fully trained and licensed practitioner in an NHSC-eligible primary care medical, dental or mental/behavioral health discipline
  • Have unpaid student loans that have been taken before your application to the NHSC Loan Repayment Program
  • Be working at or have an accepted offer of employment at an NHSC-approved service site that begins no late than 7/18/1

Nursing careers covered under the NHSC LRP include:

  • Nurse Practitioners
  • Nurse Practitioners–Mental Health
  • Certified Nurse Midwives
  • Psychiatric Nurse Specialists

If you’re looking for opportunities at NHSC-approved sites, visit the Health Workforce Connector online. In order to apply, you should follow the application guidance provided online.

Employer-Based Nursing Loan Forgiveness

It is worthwhile to check if your employer or potential employer offers a loan forgiveness benefit as a part of your employment. Some hospitals and health networks offer this assistance, so take a moment to contact the appropriate HR or Finance departments.

Other Conditions for Loan Cancellation or Discharge

There are several conditions whereby your student loans may be canceled or discharged for 100 percent of the amount of the loan, both Direct Loans and Federal Perkins Loans.

  • Borrower’s total disability or death
  • Bankruptcy (in rare cases)
  • School closed
  • False loan certification
  • False certification through identity theft
  • School does not make required return of loan funds to lender

Private Loans for Nurses

You have two options when it comes to funding your education—federal loans or private loans. There are private loan options for nurses, where you’ll receive a loan from a private lender, such as a bank, credit union or school. Private loan terms and conditions vary based on the lender and potentially on your credit, so it’s best to compare their options with federal loan options to see which options are right for you.

If you’re considering a private loan, remember that a private loan’s interest rate is variable and can often be quite high, while federal loans have a fixed interest rate. Your credit may affect how much money is offered and what interest rate you’ll receive, so make sure that you have a solid credit record, as that may be required to take out a private loan in the first place. You may also need a cosigner for a private loan. Don’t forget that it is extremely rare to find a loan forgiveness program available for private loans, so choose this option carefully and wisely.

Start Your Journey as a Nurse

Your main takeaway should be that nurses have options, and a lot of them. For a few years of service, there are many opportunities to have some, or all, of your student loan debt forgiven. The only thing that can guarantee this will happen is by doing your research, so great job maximizing your resources for debt relief. In addition to researching online, it may be a good idea to check in with your school, employer, or state’s finance or financial aid department to learn more information. And if you’re just thinking about entering the nursing field, know that there are plenty of resources created just for you to help you pay for school in advance—and get loan forgiveness later if you need it.

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