nursing student loan forgiveness
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.
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.
Loan Forgiveness for Armed Personnel: The Benefits of Being a Nurse in USA
Serving in the US Army is a very challenging opportunity. The amount of hardwork, determination and the quality of study that goes into producing the best cadets has encouraged the Obama administration to extend the existing loan forgiveness schemes and repayment plans. There are numerous advantages of joining the US Army Nurse Corps and avail the maximum benefits of the Loan Forgiveness for nurses, doctors and paramedics.
Here is what you should know about the loan forgiveness for nurses serving in Army and other associated agencies.
Comprehensive Package: Salary plus Incentives
A nurse serving with the US Army is entitled to many comprehensive financial benefits in addition to the competitive salary package. If you have availed the student loans to complete your education, the federal government offers extensive loan forgiveness for nurses with exemplary health and medical benefits. The ever-attractive retirement plans in addition to housing allowances and paid vacations annually seem to be the creamy layer in the main dish that serves tax-free loan forgiveness and complete loan debt cancellation after completing a certain years of service in the US Army.
Accession Bonus
Loan Forgiveness for Nurses is also available with sign-on bonus of at least USD 30,000! For those who have plans to serve in the Army Nurse Corps permanently can avail complete loan forgiveness with additional tangible and intangible financial benefits.
For those in active duty, whether in peace-keeping missions or serving on war fronts, need 10-14 weeks of additional training .The Loan forgiveness for nurses are available if they fall fulfil the following criteria:
- US citizenship practising in USA
- Graduation from BSN or MSN from a CCNE or NLNAC-accredited school
- Unrestricted nursing license by recognised body
- Meet mandatory Air Force/ Navy/ Army fitness standards
- Served at least three years of active duty
Active Duty incentives
Active army nurses in missions or serving as reserves can avail a loan repayment incentive of USD 10,000. It is often clubbed with the Accession Bonus, for nurses who have served a minimum of three years in active duty.
As per the provisions of Loan forgiveness for nurses in active duty, the federal agency provides up to USD 120,000 as repayment towards the educational loans, with an average of USD 40,000 per year for the three years of active duty.
Different Roles, different loan forgiveness incentives
In US Army, the loan forgiveness for nurses depends on the functionalities and the specialities of the personnel. Anaesthetists, radiologists, family nurse, midwives and clinical specialists are eligible for a payment of USD 2000 to USD 6,000 per year. For those in Active Duty, the incentive payment could be as high as USD 15,000.
Special pay towards the Loan forgiveness for nurses are extended to personnel with BSN, MSN, DNSc and PhD-Nursing.
Depending on the loan program you have chosen as a nurse, your forgiveness program will also vary depending on the principal amount taken, repayment made and previous debt history.
A Complete Guide to Student Loan Forgiveness for Nurses
Nursing as a professional is a noble assignment. But it comes with its share of challenges in the form of endless certification programs and loan repayment issues. Pursuing nursing education could dent a blow to your career plans and financial stability if you have a hefty loan to repay in your prime as a talented nurse.
Here is a quick guideline to help you sail past the hurdles of defaulting and forbearance using the provisions of Student Loan Forgiveness for Nurses.
100% Discharge with Federal Perkins Loans
If you are full-time nurse with Federal Perkins Loans in your kitty, you are eligible for as much as 100% loan discharge. This loan program offer the nurses an excellent opportunity to avail forgiveness as an incentive. The full-time employment is a mandatory eligibility criterion with different levels of specialisations, work locations and term of service.
100% discharge as per the Student Loan Forgiveness for nurses under Perkins Loans portfolio cover nurses working in hospital and health centres meant for low-income families, or catering to high-risk children. ACTION volunteer, Peace Corps and Military nurses too have 100% discharge incentives under the Student Loan forgiveness program for nurses and teachers.
Enrol with Critical Shortage Facilities
The NURSE Corps Loan Repayment Program is a unique extension of the forgiveness scheme meant for nurses employed with the Critical Shortage Facilities (CSFs). Nurses working in such designated facilities can avail forgiveness in the form of automated loan repayment within 24 months of employment. For forgiveness, a nurse has to work for at least 32 hours every week. This factor will earn a repayment benefit of up to 60%. In the third year, the nurses covered under NURSE Corps program are eligible for additional repayment benefit of 25% towards their loans.
Pick Public Service Loan Forgiveness
If you are a nurse and have a direct loan package to repay, it is best to go for Public Service Loan Forgiveness. This exemplary model allows a public service official to avail forgiveness after 10 years of continuous and timely monthly interest repayment. All Direct Loans are included in this Forgiveness, but the condition is strict with cases of defaulting. All nurses working in a public health service centre or a tax-exempted non-profitable nursing centre are eligible for the forgiveness from their 121st month of loan repayment schedule.
Best part about this student loan forgiveness for nurse is that it is 100% tax-free.
Loan assistance in shortage areas
Some parts of the country offer extensive loan forgiveness to attract nurses for shortage areas. In Alaska, the SHARP program is designed exclusively for nurses and medicos to work in return for an incentivised loan forgiveness and repayment scheme.
Similarly in Arizona, nurses can receive up to USD 50,000 of loan repayment assistance for working either as a part-time or full-time professional in shortage areas. Different states have different loan forgiveness programs for nurses.
Thanks to the novel initiative of Obama’s Student Loan forgiveness for nurses, nursing is back to its positon as a lucrative profession in the USA and abroad.
A look at Nursing Student Loan Forgiveness Programs
Nursing is known as a noble profession, the selfless individual who take the profession of serving the mankind surely need some help and encouragement from the society. When it comes to helping them there cannot be a better way than Loan Forgiveness Program for Nurses. The best news is that in United States Nursing student loan forgiveness program remain widely available via various State and Federal financial aid programs, so no matter where you work as nurse in US, you are sure to get some kind of loan relief.
The benefits are determined on the basis of their position like Registered Nurse, Nurse Practitioner etc. The level of education is also a major criterion.
A look at Federal Loan Forgiveness for Nurses
Mainly, there are three major federally funded schemes under which nurses can avail loan forgiveness benefits. These includes:-
1 NURSE Corps Loan Repayment Program also known as NHSC
2 Public Service Loan Forgiveness Program
3 Perkins Loan Discharge/ Loan Cancellation for Nurses
1 NURSE Corps Loan Repayment Program:
NELRP was specially designed to meet the financial education needs of Registered Nurses working in underserved clinic and hospitals. The word underserved here means that Federal Government is ready to pay Registered Nurses for working in poor rural and urban communities. The reason is that most nurses don’t want to work in such places. To avail the benefit the nurses need to apply and go through a systematic selection process to be eligible for the benefits.
How NELRP works:
- Nurses with two years experience at a facility that recognized by the Federal Government qualify to get 60 percent pay off on their nursing loan.
- For one additional year of service, the Federal government proposes to pay another 25 percent of the balance loan amount.
2 The Public Service Loan Forgiveness Program
It is available to nurses employed in a fulltime basis in public services jobs like education, health care, state employees etc. The student nurse borrower needs to pay 120 monthly installments, means paying loan continuously for 10-years, after the payment the borrower is entitled for remaining loan forgiveness.
3 Perkins Loan Cancellation for Medical Technicians and Nurses
Most of the people are not aware that Perkins Loan Cancelation is available for Medical Technicians. It is the reason that very few medical technicians have availed the loan. If you are one of the few ones who have availed the loan then here is how you can get the loan forgiveness.
- Nurses who qualify for Perkins Loan benefit can apply for forgiveness after completing five years experience in the nursing filed. The best part is that you can have your entire loan discharged.
- The wonderful thing about the program is that it also offers incremental forgiveness. The student nurse borrower can apply for some part of the loan to be forgiven after completion of service every year. It makes it the most unique forgiveness program available for nursing students.
Empowering Nurses to make quick career jumps with Forgiveness Schemes
Doctor, nurses and teachers form a very strong professional backing to any society. The country often misses out on the services of the professionals when students from poor background fail to capitalize on the educational infrastructure.
As education costs continue to rise, the federal loan schemes come across as a great support. For those who are not aware of how tough it could be for a student loan borrower to actually manage the interest payments, the Obama forgiveness program is an easy way out. In 10 years time, you could enjoy relief from the strenuous repayment of loan interest without any additional burden.
Nursing Education Loan repayment program is a part of the Obama forgiveness scheme where the offers are made to registered nurses and clinical assistants. The nurses can repay the educational loans linked to their professional commitments with the public and NGO-related services.
Here are some of the ways the Federal government makes nursing loan repayment scheme such a wonderful professional incentive across USA.
– Work for less than 40 hours per week
Nurses can have pretty treacherous working conditions. Just a decade ago, nurses worked for more than 50 hours per week with 6 days work shifts. Most of them had hard time managing their personal lives. Obama forgiveness scheme plotted a differential life standard benchmark for nurses who have taken Federal student loans. Now, nurses can work for less than 40 hours per week and still earn enough to repay the loan within forgiveness tenure.
The minimum number of hours a registered nurse has to week per week is 32 hours.
– Choose your own locations
Yes, nurses who have taken education loans can choose their own work locations and clinics. For initial number of years, depending on the loan sum and the forgiveness expected, a nurse in USA could be placed in areas where there is acute shortage of manpower. They could even be sent to rural and military bases. It not only pays well to serve in such locations but also adds experience into their kitty. After forgiveness is earned, the nurses can apply for further education loans to pursue higher studies. They can even switch to a private institution or an academic training school to serve as a nursing teacher.
– Earn 60 percent forgiveness in 2 years
Nursing education Loan repayment program is a part of Obama forgiveness scheme that will pay 60 percent of the borrower’s qualifying loan balance in two years of service. Additional forgiveness of 25 years is earned for the third year and henceforth.
– All registered nurses can apply for forgiveness
Registered nurses or RNs as they are referred to under the Obama Forgiveness schemes are eligible for forgiveness. The American Association of Colleges of Nursing (AACN) is the primary database for federal loan providers to fund students considering nursing as a graduate study before enrolling in the careers.
Nursing school’s financial aid department will guide you to other grant and loan programs like Perkins Loans, PLUS Loans and Stafford Loans.
A look at Nursing courses in USA covered under Forgiveness Schemes
Nurses had a hard time beating away the chaotic loan repayment schemes of the 80s and the 90s. Some of them continued to struggle under the burden off high interest rates, poor expense planning and minimal federal support in nursing profession. Obama Forgiveness scheme for nurses and teachers introduced recently has come as a potent saviour for federal education loan borrowers. It not only saves the nurses from high interest rates and prolonged loan clearance, USA is one of the few nations to offer forgiveness schemes.
Forgiveness program in USA on nursing career is available only for naturalised or permanent US residents. Government is trying to figure out if the same forgiveness benefits can be extended to international students who contribute to 27 percent of the total nursing force in USA.
Here are some programs in nursing that are currently covered by the Loan repayment schemes for nurses, both registered as well as licensed professionals.
– LPN LVN Programs
Nurses taking educational loans to complete LPN or LVN which stands for Licensed Practical Nurse or Licensed Vocational Nurse respectively can opt for federal loans. The duration is one year and is offered across many colleges in USA. Admission into these programs needs that student pass ACT, TOEFL or SAT.
A nurse passing with LPN LVN Program earns USD 40,000 as a vocational nurse. Further educational prospect includes an opportunity to apply for AAS which stands for Associates in Applied Science.
ADN Programs
ADN program is available under Loan repayment scheme as well. Nurses can earn Associate Degree in Nursing under the 15-24 month course. ADN nurses can treat, train and provide psychological care to patients. Nurses have to pass the National Council Licensure Exam to earn a license of nursing.
Average annual salary expectation of a nurse from ADN program is around USD 62,500.
– BSN Course
High-schools students can pursue their career in nursing by earning a degree in BSN which stands for Bachelor of Science in Nursing. It is a 4-year program and offered by specialized medical colleges & universities in the country.
Nurses from ADN and BSN courses have similar starting pay scale. The Obama Forgiveness schemes have most nurses from these programs.
Due to shortage of both time and money, students in USA prefer to go for a special BSN course. It is called Accelerated BSN Course which runs for less than two years. Usual tenure is 15-18 months. Only a handful of colleges offer the course with a regular BSN course.
MSN Programs
Advanced studies in nursing can be pursued from leading colleges in the country. The federal loan agencies offer forgiveness to the nursing professionals from following disciplines.
– Women’s Health Nurse Practitioner
– Paediatric Nurse Practitioner
– Family Nurse Practitioner
– Nurse Educator
– Neonatal Nurse Practitioner
– Adult Nurse Practitioner
It is the most competitive segment in nursing with forgiveness coming in less than 4 years. Average salary package for a nurse availing Student Loan Forgiveness for nurses is USD 81,000.
Other programs that are covered under forgiveness schemes are Certified Registered Nurse Anesthetist & Doctor of Nursing Practice programs.
How to smartly plan Obama Debt Forgiveness to Reduce Student Loan Debt
If you are reeling under or are planning to take a student loan to complete your graduation, this article will be a great help. Written with an intention to help you find different ways to keep your loan repayment cost, do your initial research on the federal loans and the Obama student loan debt repayment based on these tips.
1. You can’t be discharged
Before taking up the student loan amount, you must make up your mind about the repayment terms and conditions. No matter how voluminous and serious your hardships are; the chances of earning a discharge from the loan repayment are almost next to impossible. Hence, always focus on making the repayment of principal sum. This is where Obama Student Loan debt forgiveness program comes handy.
2. Pay on time, Don’t accumulate deferments and Forbearance
Payment of interest on time has a significant impact on your credit score. Even with the Obama debt forgiveness scheme in place, you may not earn the rightful benefits at the end of 25th year, if you defer or fail to pay a particular month’s interest. Since the program is still in initial decade, the prospects and repercussions of non-payment or deferments are yet to be seen.
3. Always start with a healthy Principal repayment
Whenever you get hold of handy sum, make the payment towards your principal amount. If you are paying the sum more than your minimum interest, the Obama debt forgiveness program will begin earlier than you would otherwise qualified for. Tackle your principal amount and you never have to worry about interests accumulating in the account. It helps lower your interest payments as well in the future.
4. Gear up for the public sector career
Most student loan borrowers fail to acknowledge the importance of grabbing a job in the public sector. If you have a hefty sum behind you as student loan, a public commission role can earn the forgiveness in 10 years. Public Service Loan Forgiveness is a systematic plan under the Obama student loan debt forgiveness program. You can opt for a role in either federal agencies or in Non-profit organizations listed with the federal government across USA.
As of now, close to 35 million US citizens are eligible for the Obama Student Loan debt forgiveness but only a handful; of them are aware about the opportunities.
5. Enquire about other forgiveness schemes
In USA, there are over 60 registered student loan forgiveness programs. Some employers also extend the student plan repayment programs to their prolific employees. Enquire about these loan repayment supports. Obama student loan debt forgiveness continues to be the most sought after scheme of the decade anyhow. The other prominent forgiveness scheme includes loan forgiveness for nurses and student loan forgiveness for teachers.
6. See a consultant if need be
Don’t rely too much on the information available on sites that offer quick fix guides. Search extensively on the government sites and then move to a consultant for more accurate information. You may very well get a tip on reducing the monthly instalment or get a bonus coverage under the Student loan debt forgiveness program.
Obama Student Loan Forgiveness 