Student loan forgiveness can seem like a dream come true, but it’s important to know the facts. Not all loans or repayment situations qualify, and it often requires years of consistent payments and working in specific job sectors. Therefore, always thoroughly research and understand the conditions of any forgiveness program before relying on it to clear your student debt.
Loan Forgiveness Program (PSLF) for those working in healthcare professions.
- The program only works with Federal Direct Loans. It doesn’t apply to FFEL loans or private student loans.
- You need a full-time job with an approved employer like a hospital, university, or any non-profit or government organization. You can also qualify if you have more than one part-time job adding up to 30 hours or more per week.
- You need to pay your loans through a payment plan based on your income, such as PAYE, REPAYE, or IBR.
- After you’ve made 120 payments (around 10 years if you make all payments without skipping) while sticking to the above rules, you can apply to have the remaining loan balance forgiven, and you won’t have to pay tax on it!
- It’s important to fill out a form for the program to ensure your job qualifies.
- The PSLF program was previously managed by FedLoan Servicing but is now run by a company called MOHELA.
- There was a temporary rule, called the “limited PSLF waiver,” that allowed some payments that wouldn’t usually count towards the forgiveness program to be credited. However, this ended on October 31, 2022.
- Despite the end of this waiver, the U.S. Department of Education is still working out how it affects loans. So, if your loans are federally managed, you might see an increase in the number of payments counted toward your income-driven repayment and loan forgiveness.
Perkins Loan Cancellation
Some healthcare workers can get their Federal Perkins Loans canceled after working full-time for five years. This includes roles like:
- Registered Nurses
- Licensed Practical Nurses
- Certified Nursing Assistants
- Medical Assistants
- Advanced Practice Registered Nurses
- Licensed Medical Technicians
Most healthcare workers don’t have a lot of Perkins Loans, but getting any loan forgiven is a big help.
Paying back student loans can be tricky, especially for people working in healthcare. Going for the lowest interest rate and paying everything back might not always be the best plan. Sometimes, it can cost more because there are many ways to get your loans forgiven or different payment plans you can use.
Things like your career path, getting married (which can change your loan payments), and other money goals can make it even harder to know what to do. So, it’s not always easy to figure this out by yourself.
If you need help with StudentAid.gov, call the Federal Student Aid Information Center at this number: 1-800-4-FED-AID (which is also 1-800-433-3243). You can also get in touch with them through the “Contact Us” page on the website.
