Does working in a hospital qualify for loan forgiveness

Insider's experts choose the best products and services to help make smart decisions with your money (here’s how). In some cases, we receive a commission from our our partners, however, our opinions are our own. Terms apply to offers listed on this page.

• You may qualify for student loan forgiveness if you are a nurse working in a high-need area.
• Public Service Loan Forgiveness has no maximum amount of money that can be forgiven.
• States offer different loan forgiveness programs to nurses.

The pandemic has taken a significant toll on healthcare professionals, particularly nurses, and student loans only add to the stress. Luckily, there are programs in place to help you get some or all of your student loan debt repaid or forgiven. 

Nurse Corps Loan Repayment Program

The Nurse Corps Loan Repayment Program incentivizes nurses to work in underserved communities at critical shortage facilities or in eligible nursing schools. This program covers 60% of your unpaid student loan debt — federal or private — after two years of full-time, qualifying employment. You may be able to take on a third year in the program to get an additional 25% of your loans paid off. 

You'll need to pay taxes on the money you get from the program, unlike some other forgiveness programs. Additionally, you'll have to be a licensed registered nurse, advanced practice registered nurse, or nurse faculty to qualify.

Applications for the program are accepted once per year and you can apply on this website. You can find a list of hospitals and clinics that qualify as critical shortage facilities with this government tool. 

Public Service Loan Forgiveness

Public Service Loan Forgiveness, or PSLF, forgives the debts of graduates working in the public sector after at least 10 years of full-time employment and 120 qualifying payments. There's no cap to the amount of money that can be forgiven. 

You might be eligible for PSLF as a nurse if you work for the government or a non-profit hospital or health service organization. 

You must complete an Employment Certification Form once per year or whenever you change jobs. After you've made all of your qualifying payments, you can send in a PSLF application. 

National Health Service Corps Loan Repayment Program

Through the National Health Service Corps Loan Repayment Program, licensed nurse practitioners may be eligible for up to $50,000 in student loan repayment assistance if they work full-time for two years in a designated Health Professional Shortage Area. Part-time workers may qualify for up to $25,000.  

Both federal and private student loans are eligible for this program, and you won't pay taxes on money received from the NHSC program. You can't use this program and the Nurse Corps Loan Repayment Program at the same time. 

You can apply for the program online.

Perkins Loan Cancellation

Perkins Loans used to be offered to low-income undergraduate and graduate students, though the program has since been discontinued. While Perkins Loans are no longer being given out to students, if you have them, you may still qualify for full loan forgiveness through the program. 

You can have your loans forgiven in tax-free increments if you work as a nurse full-time for five years in a high-need community. 

To apply for Perkins Loan Cancellation, contact the school you received the loan from or your loan servicer. Your school or servicer will tell you what documents you need to send in and forms you have to complete. 

State-specific loan repayment programs

Your state might have additional repayment programs available to you. The best way to find out if your state has a program is to contact your state's health department or to ask your employer for more information. Here are a few examples of state-based programs:

• California: To qualify for the Bachelor of Science Nursing Loan Repayment Program, you must be currently licensed and practicing as a Registered Nurse and have a BSN degree. You may receive up to $10,000 if you work in a designated Health Professional Service Area for one year. You may get this award up to three times. 
• Idaho: If you work in a designated Health Professional Service Area, you may get loan repayment assistance through a federal grant, matched dollar to dollar by your employer. You may receive anywhere between $10,000 to $25,000 per year depending on how much your employer matches. You're required to work for two years full-time. 
• Iowa: Nurses in Iowa may qualify for the Health Care Loan Repayment Program. The maximum yearly award is the lesser of $6,000 or 20% of your total outstanding qualified student loans. You must work or teach in specific underserved areas for five consecutive years.

This list is not exhaustive, and you should check with your state to see what programs are available to you. Keep in mind that forgiveness and loan repayment programs aren't the only option for handling your debt. If you're struggling to keep up with your federal loans, you may want to try an income-driven repayment plan, which bases your monthly payments on your income and family size. 

Ryan Wangman is a reporter at Personal Finance Insider reporting on personal loans, student loans, student loan refinancing, debt consolidation, auto loans, RV loans, and boat loans. He is also a Certified Educator in Personal Finance (CEPF). In his past experience writing about personal finance, he has written about credit scores, financial literacy, and homeownership. He graduated from Northwestern University and has previously written for The Boston Globe.  Learn more about how Personal Finance Insider chooses, rates, and covers financial products and services here >>

Read more Read less

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any card issuer. Read our editorial standards.

Please note: While the offers mentioned above are accurate at the time of publication, they're subject to change at any time and may have changed, or may no longer be available.

**Enrollment required.