Student Loan
What is Trump Student Loan Forgiveness?
Trump Student Loan Forgiveness is a strategy aimed at reducing student debt. Currently, student debt is at an estimated $1.3 million in the United States. When the average student graduates, he has a student loan of minimum $37,000. On an average, 7 out of 10 students take out a loan for their post-secondary education.
According to President Trump, the high cost of tuition is the government’s fault. He has made it clear that he does not want the federal government to earn profits from student loans.
In order to make student loan repayment easier, Trump has proposed a revised version of the current income-based student loan repayment plan. In the current Obama Student Loan Forgiveness scheme, borrowers are required to make monthly payments on their loan at 10% of their income, for a period of twenty years.
Trump’s plan is similar except for a few alterations. In Trump Student Loan Forgiveness Plan, graduates will be expected to pay back 12.5% of their monthly income. The payment program will run for 15 years instead of 20, after which all outstanding loans will be forgiven. According to President Trump, “If borrowers work hard to make their payments for 15 years, we’ll let them get on with their lives.” When asked how he wanted to achieve this plan, Trump replied, “the plan will be paid for by lowering federal spending on ever-rising college tuition fees and fewer defaults on student loans.”
What other steps does President Trump plan on taking to reduce student debt?
Listed below are some of the alterations Trump plans to implement in his Trump Student Loan Forgiveness scheme:
- Complete elimination of the Department of Education
- Schools to be punished financially if their students are unable to repay loans. Schools will also be partially responsible if a student defaults on his loans.
- The federal government should stop profiting from student loans.
Although Trump’s Student Loan Forgiveness scheme seems promising, how the plan will be implemented with which stipulations remains to be seen.
Loan Forgiveness: What jobs qualify?
What jobs qualify for student loan forgiveness? These jobs are opportunities that have emerged as a way to invite new employees into less desirable/appealing employment sectors.
The following is a list of career opportunities that offers student loan forgiveness:
Federal Agency Employees
Federal agencies that are having a difficult time filling open employment slots are allowed to propose student loan repayment assistance. The new employee will be required to a sign a contract with the agency for at least three years. The agency may pay up to $10,000 every year for a federally insured loan. The total assistance amount cannot exceed $60,000.
Public Service Careers
Federal Perkins Loans are available to full time public service employees who have not consolidated their loans. Public service employees who qualify for Public Service Loan Forgiveness are child and family services employees, correctional officers, law enforcement and public defenders to name a few.
Student Loan Forgiveness for Doctors
There are several modes of assistance for doctors with regards to loan repayment assistance.
The Association of American Medical Colleges (AAMC) has a list of federal student loan forgiveness program and scholarships for doctors according to state. In addition, medical professionals who provide military service may access loan forgiveness as well.
Student Loan Forgiveness for Lawyers
The Department of Justice runs an Attorney Student Loan Repayment Program to help recruit and retain lawyers. Employees in the Justice Department must have a federal student loan of at least $10,000 to qualify.
For students who want to work as Public Defenders, the John R. Justice Student Loan Repayment Program grants up to $10,000 each year with a maximum benefit of $60,000.
SEMA Loan Forgiveness Program for Automotive Workers
An automotive aftermarket industry manufacturer who is employed by the Specialty Equipment Market Association (SEMA) is eligible to apply for this program. Each year, the program awards winners up to $2,000 to apply towards their outstanding student loans. Top recipients receive up to $5,000. To be eligible, you must be a part of SEMA for a minimum of 1 year, have a certificate or degree from a technical college or school and have a GPA of 2.5. In addition, your outstanding debt must be at least $2,000.
Loan Forgiveness for Nurses
If you are a nurse practitioner, registered nurse, HPSA facility nurse or advanced practice registered nurse, you may apply for the Nurse Corps Loan Repayment Program. Nurses who are chosen will receive 60% forgiveness on their outstanding loan balance in exchange for at least two years of service. In addition, participants may also receive a further 25% off their original balance if they complete three years of service.
Teacher Loan Forgiveness
Teachers who teach in a teacher shortage or underemployed area, or in a low-income school may apply for this loan. Special education teachers are also eligible. Qualifying teachers may receive between $5,000 and $17,500 towards loan forgiveness. This depends on the subject matter and years of service.
Volunteer Organization Workers
Some volunteer organizations such as the Peace Corps, Volunteers in Service to America (VISTA) and AmeriCorps offer student loan forgiveness. You may apply upon completing a term of service with the volunteer organization.
Top 6 Ultimate Tips for Paying Student Loan Faster
The student loan is a big help when you are pursing your studies. It helps you realize the dream of making a career in your desired field, but the same student loan can become a headache if you don’t repay it on time. Here, we are going to tell you some smart strategies to pay back student loan faster.
1 Add Extra Money to your Monthly Installment
It is the simplest method to reduce your debt. Whenever possible add extra money to your monthly installment. Generally, you are going to keep aside a separate amount for the repayment, so adding a little extra to it won’t be that difficult. The extra amount will directly go towards your principal. It is not necessary that you should put a fix amount, pay whatever additional you can manage. Believe us it is going to make big difference in long run.
2 Find your Payoff Date:
Most students forget about their payoff date. It is important that students should know when they get free from student loan debt because if you know the date then you can work out things accordingly. The easiest way to find out about your student loan is to check student loan dashboard. It will help you to adjust payments, check due dates and add loans.
3 Refinancing:
It is one the best ways to quickly pay off your student loan. The aim of refinancing is to decrease rate of interest by making more payment towards your loan. When you go for refinancing you get a consolidated loan amount to be paid on monthly basis.
4. Use cash windfall:
The cash windfall can be in various forms- winning lottery, insurance claim, inheritance, settlement from lawsuit, etc. A study shows that people getting a big chunk of money go on a reckless spending sphere buying luxurious cars, houses and going on exotic holidays.
Instead of spending money on things that can a wait, use it for clearing your student loan debt. Even you can use tax refund to make loan repayment.
5 Take up job that offers student loan forgiveness:
There are certain public service jobs like teaching, nursing, defense etc that offers student loan forgiveness. These are also covered under Obama Loan forgiveness program. To be eligible for the forgiveness you need to fulfill the criteria. It is an effort by the government to attract more people into public sector jobs. The most popular loan forgiveness programs falling in the category are Teachers Student Loan Forgiveness Program and Nurses student loan forgiveness program.
6. Smartly use your Salary Hikes
Salary hikes are part of compensation. It would be intelligent move if you use the amount towards your student loan payment. In fact, you can add up the percentage you are getting as a hike to your monthly student loan installment. Suppose you got a hike of 500 dollars then you can completely or partial direct that amount towards paying the loan. Remember, the amount is going to be apart from the monthly installment, so if you add $ 300 every month to student loan, it comes to $ 3600 in a year. Similarly, you can use your bonus for loan repayment.
How to get Student Loan Forgiveness: 4 Things that nobody told you
In the USA, only 40% of the student loan borrowers are eligible for some or the other type of loan forgiveness. However, out of this percentage only 10% borrowers actually take advantage of the forgiveness schemes. Each year, millions of students pass out of the campus with an average loan debt of $22,500 or more. Hoping to get a well-paying stable job makes most student loan borrowers seek opportunities in the private enterprises. However, this may not be the best thing to do, especially when there is a heavy competition in the private sector.
Keeping in view that many schools and colleges run by the government require quality teachers and professors, the Obama Loan Forgiveness scheme comes as a handy financial aid.
We bring you 4 features about the Obama Loan Forgiveness program that most borrowers find to be “misleading”.
1. Obama Loan Forgiveness is applicable to Federal Loan Borrowers only
Thus far, only federal loan borrowers of graduate federal loans are eligible for entry into the Obama Student Loan Forgiveness program. The loan is taken from the school enlisted by the federal government and the education department to support the students attending a particular curriculum.
In case the student drops out of the classroom, or fails to complete the course, the debt against that student is borne by the school. However, the student borrower is labeled as a delinquent and disqualified from seeking any further financial aid from the federal institutions.
2. Is forgiveness really possible?
Obama Loan Forgiveness scheme seems to be working well thus far, especially as it is linked with the existing Public Service Loan Forgiveness and NURSE Forgiveness programs. Moreover, public officials who have federal loans are offered extensive incentives for continuing with their professions, serving the community.
For instance, a teacher with 5-year experience in the profession, and currently engaged in teaching students from low-income or no-income families can earn forgiveness of up to $17,500 per year. By the 5th year, most of the debt is either paid away in the form of graduated incentives linked to the federal loan, or provided Grants/sponsorship to pursue further education.
3. Forgiveness will arrive from 2017-2018
The first set of qualified borrowers under the Obama Loan Forgiveness would be granted waivers after October 1, 2017.
The strict condition is that the borrowers should have repaid their monthly interests diligently for 120 months.
4. Will the FFEL Program borrowers be considered?
The Federal Family Education Loan program is second-most popular education funding scheme after the Direct Loans. Launched in 1965, the FFEL was permanently terminated in June 2010. Thus, Obama Loan forgiveness is not applicable for the borrowers. However, if the FFEL Program is consolidated with Direct Consolidation Loan, the borrower can apply for the forgiveness as per the PSLF regulations.
Only the repayments made after consolidation would be counted in PSLF, no matter how much you have repaid earlier.
Thus, you should always consider consolidating the student loans with the Federal Direct loans to earn maximum returns.
Impact of Loan Forgiveness schemes on the Healthcare industry
Education sector in the United States of America is steadily falling behind the contemporary market demands. The healthcare sector in particular is the worst hit industry when it comes to finding good talent and employing them to cater to the rural needs. Nurses and paramedic officers are hard to find, and manage. The major reason for the lack of talent and volume of nurses in US’s healthcare industry is blamed majorly on the lack of financial aid.
The Statistics on Nurses
According to the recent data published in the year 2014 by the Bureau of Labor Statistics, there are currently 2.9 million nursing jobs all over the USA. Out of these, only 37% are actively engaged, and rest are looking for greener pastures in private firms or seeking a higher education to upgrade their skills into research field or take up specialist roles in the health care industry as doctors, physiotherapists or as radiologists. In short, the graduate nurses actively engaged in nursing profession may not stay in their current roles for long.
The Loan Forgiveness for Nurses have been designed to ensure that “job migration” does not affect the healthcare industry drastically, especially in rural areas where there are only 10 nurses for every 1700 persons in the USA.
Mode of engagement
What is astonishing about the nursing education in the USA is that more than 15% actively-engaged nurses have earned their Master’s or Doctoral degrees by taking loans. Despite best efforts, they have a hard time finding a reasonably well-paying job in the industry. Lack of incentive from the privately-owned hospitals and healthcare facilities is taking its toll on their government counterparts. In the dilemma over joining a bond-oriented government job, nurses prefer to stay back in the private firms. Which means, the loan repayment becomes tough, and in some cases, unmanageable.
Sadly, in a country where doctors and medical officers form more than 1.5%, qualified nurses account for only 0.76%! Out of these many nurses, most of them have heavy students’ loans overhead. Loan forgiveness for nurses, thus have a very important role to play both in educational sectors as well the nursing sector in tandem.
Top Loan Forgiveness for Nurses Programs in the USA
There are many Loan Repayment Programs (LRP) considered by the nurses as loan forgiveness schemes in the USA.
- Federal PERKINS Loan Discharge
- NURSE Corps Repayment Program
- PSLF
- National Health Service Corps LRP
- Iowa’s Registered Nurse LRP
In order to qualify for the loan forgiveness for nurses program, the applicant has to satisfy some eligibility criteria like completing licensing training, fulfill employment conditions as full-time nurse, or as intern, and proven American citizenship. In some Loan Forgiveness schemes for nurses, the applicant has to necessarily complete at least 5 years of full-time employment with registered healthcare institutions.
For all the right reasons, the schemes related to the Loan Forgiveness for Nurses are hot topic in the USA. Critical to the system concerning hospitals, nursing homes, rehabilitation institutions and military barracks, the nurses play a very important role.
5 Government Programs Compliment Student Loan Forgiveness to Repay Your Loans
Loan borrowers are always on a look out for a friendly loan repayment or loan forgiveness program. It is actually possible for a student loan borrower to apply for loan forgiveness and repayment based on the specific requirements. Doctors, teachers and nurses are top professionals vouching for the Student Loan forgiveness programs.
Here are three really easy options available in the Loan Forgiveness programs. They work in tandem with the directives from the Department of Education (DoE) and the government-sponsored loan programs.
1. Teacher Loan Forgiveness
If you are a full-time teacher and have complete five consecutive years of service, you are eligible for this Student Loan Forgiveness for teachers. There are two specific types of loan forgiveness programs for teachers—
- Teacher loan forgiveness on Direct Loans (subsidized/unsubsidized, both) and Federal Stafford Loans (subsidized/unsubsidized, both)
- Cancellation program for Perkin Loans
Teachers from the low-income families can earn a combined repayment support of up to $17,500.
2. Public Service Loan Forgiveness (PSLF)
This is a great option for volunteers as well as professionals serving in the public sector in government office or in NGO. Once you make the 120 monthly qualifying payments or 10 years of payments, the loan borrower can subscribe for a forgiveness on the remaining balance of the Direct Loans.
3. Income-driven plan
There are four income-driven repayment plans—
- Revised Pay As You Earn Repayment Plan (REPAYE Plan)
- PAYE Plan
- IBR Plan
- ICR Plan
These student loan forgiveness plans are driven by an incentive to reduce the monthly interest based on your income. Depending on the income, monthly expense and number of dependents in the family, the monthly loan interest is deduced as some percentage of that available income.
The repayment period is usually between 20-25 years depending on the choice of IDR plan. The remaining loan amount is forgiven after the end of the repayment period.
The eligibility to earn entry into the IDR plan depends on your borrowing date.
4. Join a military service
The federal government provides ample benefits and incentives to the Student Loan borrowers joining the military services as teachers, trainers, physiotherapists, doctors, nurses and other professional occupations. The DoE and the Department of Defence cap the interest to be paid every month for a certain period of time, thus earning a respectable forgiveness during the service.
The student loan benefits for the members of the armed forces are available for both federal and private loan borrowers. Here are 4 benefits offering Student loan forgiveness for nurses, doctors and teachers engaged in military services.
- Service members Civil Relief Act (SCRA) Interest Rate Cap
- Military Service Department
- Deferments after Active duty
- PSLF
- IDR Plans
- HEROES act waiver
The student loan servicer waives off full or part of the loan sum as per the military orders.
Student loan forgiveness for teachers, nurses and military personnel can be further guaranteed through regular interest payments, even if there is a deferment available against your account.
How to Take Advantage of Student Loan Forgiveness Program?
The Congress made massive inroads into resolving the increasing debt volume from Student loan portfolio way back in 2007. In 2007, the launch of the Public Service Loan Forgiveness program (PSLF) paved the way for student loan borrowers to plan their repayment strategy spread over a span of 10 years and more. The flexible income-based repayment plan was readily accepted by the low-income debtors who had a rather slow career growth. Inspired by the response of the PSLF, Loan forgiveness for teachers and other professionals were also introduced, making it possible for the low-income debtors to pay off the loan in time, but over a longer period of time.
If you are a Student Loan borrower, here are some really smart ways to take full advantage of the forgiveness program.
1. Work diligently as a volunteer
If you are working in a for-profit organization, you can double up your chances of loan forgiveness by volunteering for public service and NGO activities in rural and acute shortage areas or hamlets. Public health, education and law enforcement organizations are encouraged to employ teachers, nurses and military personnel with an incentivised loan forgiveness program and annual repayment bonuses for completing a year at service.
2. Work for 30 hours minimum
Employment requirements play a major part in deciding loan forgiveness for teachers and nurses. The loan servicers contact the employer for the number of hours worked in a week for a year before sanctioning the loan forgiveness for nurses and teachers.
3. Get ready for an underserved area
Federal health care service providers offer attractive incentives on loan forgiveness for nurses willing to work in an approved underserved region for a certain period of time. In addition to the salary and bonuses, the Federal Government encourage the nurses and doctors with respectable repayment bonuses. Before taking advantage of the loan forgiveness program for nurses working in rural areas, you should actually know the site well.
A site covered under the Health Professional Shortage Area (HSPA) list is a great place to start off a career, as they provide loan repayment assistance through numerous programs. One of the major loan forgiveness programs for nurses in HSPA is the National Health Service Corps (NHSC) Loan repayment plan, where an individual has to serve 2 years in full service or 4 years in half-service as a dentist, doctor, or mental health personnel.
4. Check eligibility in PSLF Partial Hardship Plan
When the annual amount due on a student loan borrower exceeds 15% of the discretionary income, the borrower can apply for entry into PSLF’s Partial Financial Hardship assistance. A public service with high debt to income ratio readily qualifies for the program. In order to earn forgiveness, most federal loan borrowers make reimbursements through Income-driven repayment plans. If you have really low income, you could be eligible for a repayment as small as $0 per month!
The Ultimate Student Loan Repayment Guide for Nurses
Every year 100,000 nurses are minted in USA, and most of them carry a heavy burden of student loans on them, running deep into their career. Doctors and nurses in USA are bogged down by an average medical school debt up to $183,000! The report made by a leading association of medical professionals in USA back in 2014 highlighted the need to promote Student Loan forgiveness for nurses and doctors. Despite the growing numbers of the nurses and proportional hike on the salaries based on experience and specialization, the medical professionals are finding it hard to handle the student loan burden.
Are you planning to pursue nursing? Are you willing to explore the student loan funding to boost your chances of completing and then specialising in medical field? If yes, here is a guide to help you repay the student loan and earn forgiveness on time to ease monetary stress.
Do your math right
Let us start with the beginning of your nursing academics. It can take anywhere between five to seven years to complete the nursing course, and then continue with live training as interns. Nurses looking for student loan should plan their budget accordingly. Consider the annual inflation rates to plan the income versus expense chart. Student loan forgiveness for nurses is available for Income Based Repayment plan. Avoid large interest payment plans to avoid unnecessary stress in the future.
Plan your wealth-building potential
Consider investing in a retirement account to neutralize the heavy interests on student loans accumulated over a period of time. Do you want to build a strong asset portfolio? Student Loan forgiveness for nurses is an incentivised program where the forgiving lender issues a form to the borrower. This is done to report that the borrower’s loan has been forgiven and the tax to be paid. Since the write-off earned from the Student Loan Forgiveness for nurses program is taxable, it is always best to invest in wealth-building plans and asset portfolio.
Refinance options
Paying back the student loans can become easier with refinance options. With proper guidance from loan experts, nursing professionals can save up to $ 150 per month through consolidation of public loans, and also earn insights into new career options and a support system to build a great refinance strategy.
Refinancing of the student loans for nurses is available for professionals who no longer are in school and training. It is feasible option for Income-based repayment plans spanning over 5, 10, 15 and 20 years.
Work in a shortage area
Loan forgiveness for nurses is available for professionals willing to pursue a career in shortage area within the states. Federal loan forgiveness programs and scholarship programs are directed at primary-care physicians and other health professionals who work in acute shortage areas for two years at least. The two-year contract with the State Loan repayment program assists by repaying student loans up to $25,000 during the term.
When it comes to repaying the loan, be extremely careful with bonuses and incentives. If you are on income-based repayment plan, use these incentives to reduce the loan burden in one payment.
How to Simplify your Loan Repayment and Forgiveness with REPAYE?
Thanks to the latest introduction of REPAYE Plan that simplifies the disbursement of loan forgiveness for teachers and nurses, life has become easier. The government plans to make the Obama loan forgiveness program into a far-reaching program that can benefit more than 6 million+ student borrowers. For REPAYE, all you have to do is prove that 10-percent of your income can’t repay the loan installments.
Why REPAYE for nurses and teachers?
Professionals working as nurses and teachers in government and NGO agencies have a hard time managing their loan repayments, especially if they have borrowed student loans separately for undergraduate and graduate programs.
REPAYE Plan treats the UG and graduate student loan borrowers separately which is a great way to simplify the Loan forgiveness scheme for nurses and teachers who have hard time consolidating their portfolio. Many borrowers fighting their entry into the loan forgiveness scheme no longer have to wait for the date restrictions.
Unlike PAYE, the older borrowers can also enjoy the benefits of Loan forgiveness linked to REPAYE, which could add additional numbers of benefiters into the list.
When is the borrower forgiven?
For undergraduate and graduate borrowers, the forgiveness comes after 25 years of repayment through REPAYE. The capping of income is set at 10% of the discretionary amount, however according to REPAYE, the standard repayment on a monthly basis will attract higher rates if the income of the nurses and teachers increase too. This means that the interest sum will keep accruing on a monthly basis, but the eligibility for forgiveness will be applied only at the end of the 25th year.
Eligibility conditions
Eligibility under REPAYE is clear and straight. To earn forgiveness, student loan borrowers have to satisfy the following conditions—
- Citizen of USA
- Borrower with Direct Loans
- Clear financial record with no debts and default history
As there are no date restrictions involved in REPAYE, the borrowers of student loan can enjoy the forgiveness and capping benefits even if the loan was availed 20 years back. Eligibility in REPAYE is simple and direct.
What are the restrictions in availing REPAYE?
- Non-Direct Loan borrowers can’t be included in the list of benefiters
- If you are already enrolled with the Income Contingency Plan
- If you have a high income such that you exceed the 10% capping eligibility
- If you have Parent Plus Loans
In order to enjoy the benefits through the REPAYE Plan, borrowers looking for Loan Forgiveness for nurses and teachers have to re-certify their income annually to stay eligible for the benefits. Without yearly certification, the benefits will be waived off immediately and the forgiveness term could be delayed without any notification.
How to enroll in REPAYE?
Getting enrolled with REPAYE is direct and involves interaction with the loan service officer. You could either apply through a written application form or by submitting online application form to the Department of Education—DoE.
For the benefit of the borrowers, the entire application procedure and subsequent verification is 100% free, with no hidden cost of documentation or approvals.
How Loan Repayment Program Benefits Nursing Professionals?
Nursing in USA is a respectable job but comes at a rather high cost of education. As the pursuit for good quality nursing education becomes important, the federal loans come as a handy aid for families struggling with rising cost of education.
However, to enjoy the benefits through loan forgiveness programs for nurses, an individual has to fulfil certain conditions—
- Volunteer activity with NGOs and community service agencies
- Serve in military centres, wartime areas and in peace-keeping organizations
- Teach and practice nursing or medicine in community centres/ educational centres
The repayment benefits in Loan forgiveness for nurses are applicable only if the practitioners have paid up/ paying up the loan interest on a monthly basis.
Forgiveness on loans for nurses—Join top organizations in USA
Best American organizations in USA with long history of medical aid and welfare programs support the federal government in strengthening it forgiveness programs. The joint association with the federal government encourage nursing professionals to improve socio-economic conditions and health-care workers across the USA.
Here are top career choices you can make to gain consistent loan forgiveness benefits for nurses.
- Military Aid
Army Nurse loan forgiveness is a great incentive for fresher graduates who are looking to quickly repay their loan sum. This program is available for both public sector employees as well as those working with private groups. The army nurses are required to replace and reinforce medical officers on the warfront or the battalions engaged in peace-keeping missions.
A nurse under this scheme can earn bonus up to $ 25,000 USD, in addition to $ 100,000 that can be paid towards the repayment of loan in easy EMIs. Moreover, a nurse with an experience of over 2 years can get USD 50,000 under the US Army Reserve Health Program towards the loan repayment.
- AmeriCorps
This is an exclusive sponsorship-backed program launched by the US government to encourage nursing professionals in teaching, training and public health commissions. A one-year program with AmericCorps can earn a stipend of up to $8000 USD with additional income of $ 4500 to be paid towards the repayment of the student loans. This additional income is a definite loan forgiveness sum for nurses that reduce the monetary burden.
Different loan forgiveness schemes for nurses joining AmericCorps are available in programs like—
- AmeriCorps VISTA (Volunteers in Service to America)
- AmeriCorps NCCC
- AmeriCorps State and National
Education Award of $5000 and more can also be availed along with living allowance, health aids and child education care.
- Peace Corps
PeaceCorps have been transforming lives of millions of Americans and international citizens for years now. With ever increasing demand for quality health care services, nurses serving in USA have a wonderful opportunity serving at Peace Corps but also earn loan forgiveness with remarkable volunteering sponsorships and generous allowances from the government.
All loan repayment benefits are available for nurses and medical professionals working on long-term healthcare programs, military aid foundations and non-governmental agencies working for unprivileged communities.
Obama Student Loan Forgiveness 