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Nursing Student Loan Forgiveness | What’s new?

5 two female nurses studentsNursing student loan forgiveness program assists professionally qualified personnel to repay the nurse education loan.

This program was introduced to encourage nurses to find suitable employment opportunities in the states where critical nursing shortages are present.

This way there is mutual growth – professionals are placed where they are needed, and an urgent need is filled in a community that needs it.

Many hospitals have enrolled them under this policy in order to get the maximum benefit. The nurses who avail loan forgiveness program either Federal or State loans should make sure that the hospital is been registered under this program.

Debt repayment needs to be done in correct monthly bases, no matter what your condition is. This could be tough when you don’t have a job or when you don’t want to complete your education. In such cases if you don’t repay the debt at regular bases, you should be ready to deal with serious legal issues.

Why Nursing Student Loan Forgiveness Program is been introduced?

To make the repayment easier and also to relieve you from the repayment process, few student loan forgiveness programs have been introduced. These programs help not only the students of various departments to gain financial support from the government but also help in the improvement of the poor rural areas.

Usually people do not prefer to work in such places and they are often neglected and do not have any emergency services accessible to them. There is no place which is immune to critical emergencies that need immediate responses, and the government has introduced a scheme that solves this problem without too much fuss.

Any scheme that aids the poor and needy is a boost in favor of the government. There is no point in favoring only rich communities, especially when it comes to access to good medical care. A small improvement in poor rural areas is a positive boost for the government.

Since nurses generally do not consider working at these places, the government has indirectly motivated them to work at these so-called underprivileged communities in order to avail the student loan forgiveness. The hospitals at these locations are only registered under this loan forgiveness programs. Hence, these loan forgiveness programs have generated a very good improvement in the health sector at the underserved urban and rural areas.

Also, this helps the nurses to close their debts in a certain period of time. The government also gets an appreciation for efficient management of the basic needs at critical shortage facility areas.

Federal Loan Forgiveness for Nurses

In 2016, the good news is that as a nurse you can avail the program in some form to help the repayment of your nurse educational debt. The benefits depends on the area where they live, their position in hospitals (RN or nurse practitioner) and their level of educational qualification. There are three federal funded programs which aids the nursing loan forgiveness benefits.

  • The NURSE Corps Loan Repayment Program (NHSC)
  • Perkins Loan Discharge or Loan cancellation For Nurses
  • The Public Service Loan Forgiveness Program
  • The NURSE Corps Loan Repayment Program (NHSC)

This program enables benefits for nursing professionals who work in the underserved locations both urban and rural areas in America’s critical communities. The locations that are under the radar, so to speak, aren’t usually the first pick, so there is always a shortage of qualified professionals in these places.

With the introduction of this program and the valuable benefits it provides, it has actually created a huge competition. Now there are applications and selection process for availing the benefits of this program. The application process takes around three months – which begins in January and goes on until March.

This program could give a big relief for the nurses since it covers the maximum part of your nurse educational debt.2 years of work at hospitals at underserved areas gives a benefit of 60% repayment by the Federal government. An additional 1 year of work in similar localities gives additional 25% repayment of your original loan balance amount.

Before you apply make sure you are eligible for applying. Online applications are available for you to check the eligibility. The application raises a contract that makes sure you agree to work full time (32 hours a week) in Critical Shortage Facility for 2 years. In case of non-fulfillment of the agreement will cause serious repercussions.

This program is introduced to create healthy communities in poor urban and rural areas. By this policy non-profit health and medical institutions in the underserved areas get the chances of improvement. Nurses aren’t the only ones eligible for this program:

  • The nurse faculty member also is eligible to avail this forgiveness program.
  • Similar to nurses who work at critical shortage facilities, a nursing school faculty needs to teach at registered public or private non-profit school of nursing at such locations.
  • They teach the Pre-licensed students, RNs or advanced practice nurses.
  • They also get the complete advantages of this nurse corps loan repayment program.

Eligibility criteria:

  • You should be a licensed nurse or nurse faculty – That is you should have completed the nurse education in any state in U.S. and ready to work in any hospital at underserved area.
  • As a nurse you should be practicing in a critical shortage facility or be ready to opt for one as a full time employee (that is 32 working hours per week).
  • You should be a U.S citizen or national and lawful permanent resident and your nurse education should be done at one of the states in U.S.

Advantages

  • This program helps the nurses to get maximum benefit from the federal government. Around 85% of loan debt can be availed by the nurses in a period of 3 years work in critical underserved facilities.
  • The poor rural and urban areas show a drastic improvement in their health sector. The non-profit hospitals and clinics which have enrolled in Loan forgiveness program show more functional development in their operations at all the levels.

Disadvantages

  • The agreement if denied to be followed by the nurse or if the nurse tries change her working preference to a better hospital without completing the debts for the mentioned number of years, they would undergo serious problems financially.
  • They might have to pay the complete debt amount without further assistance from the Federal Government.
  • Also it creates confusion in the health sector when the nurses are not clear about the program agreement.
  • Perkins Loan Discharge or Loan cancellation For Nurses and Medical Technicians

5 nursing-students-walkingThis program is not known by many since it is more famous by the name “Teacher Loan Cancellation Program”. Hence there are not many people who had availed Perkin’s loan for their nurse education. Now that you know the terminologies of this program, you should know the it’s valuable benefits too.

If you are eligible to avail the Perkin’s loan forgiveness, then your complete Perkin’s loan can be discharged with your service for five years. The best part of it being the incremental forgiveness which means a part of your student loan is forgiven every year. This is the only program which gives the qualified and eligible nurses such a benefit.

Eligibility criteria

Eligibility conditions for nurses is been restructured in 2016, and the following applicants can take the complete benefit of this program.

  • Registered Nurses (RNs)
  • Licensed Practical Nurses (LPNs)
  • Medical Assistants (MAs)
  • Certified Nursing Assistants (CNAs )
  • American Registered Nursing Practitioners (ARNPs)

Any licensed Medical Assistants who work in medical fields like therapy, dental hygiene etc. can also avail this Loan cancellation program. Below is the eligibility list:

  • Occupational Therapists
  • Occupational Therapist Assistants
  • Physician Assistants
  • Physical Therapists
  • Physical Therapist Assistants
  • Dental Hygienists
  • Dental Assistants
  • Dental Lab Technicians
  • Respiratory Therapists (Entry Level and Advanced)
  • Perfusionists
  • Anesthesiologist Assistants
  • Medical Assistants
  • Orthostists / Prothetists
  • Speech Language Pathologists
  • Clinical Lab Technicians with Associates Degrees or Certificates
  • Medical Lab Technicians with Associates Degrees or Certificates

Thus the program covers more people since it’s not only for nurses. This also gives full loan forgiveness by the end of 5 years of service. No other program had this advantage.

Advantages:

  • The biggest advantage of the Perkins loan forgiveness is that you are able to get a maximum forgiveness from the principal amount as well as the interest that’s been building up on the loan.
  • This covers a vast majority of people from the health sector. It is not only for the nurses.

Disadvantages:

When you are trying to consolidate a loan, you need to think twice since the advantages of Perkin’s loan would get faded away. So loan consolidation would be a problem. Still you can work on the options. You just have to figure out which is more advantageous – Perkin’s loan forgiveness program or debt consolidation.

If you are expecting a job which would provide loan forgiveness then you should get the advantages of it. Else there is no need to think much about it since debt consolidation has more benefits.

  • The Public Service Loan Forgiveness Program

The Public Service Loan Forgiveness Program was initially created by Congress in 2007. Later President Obama’s Loan Forgiveness Program was introduced which consisted of three major changes.

  • Complete forgiveness to federal student loan would be provided after the nurse or the borrowers paid 240 monthly payments or 20 years.
  • Pay As You Earn Student Loan Repayment Plan was also introduced.
  • Updates were made to Public Service Loan Forgiveness Program (PSLF) which offers complete forgiveness after 120 payments or loan forgiveness for nurses after 10 years.

As per the recent update in 2016, President Obama has announced that 400,000 Americans who are permanently disabled will be receiving a complete forgiveness. The best part of this program is that the Federal Government will be sending the applications to those who are qualified for this PSLF program so that none of the permanently disabled Americans gets missed out.

This program can only be availed by the students who have taken Federal Student Loan The rest of the students who have taken non-federal student loans will have to face the problem of dealing with their debt. Few state level student loan forgiveness programs are available for the rest. They are not eligible for the complete forgiveness.

Many are not aware if they are eligible to this program. Applicants must be in Direct Loan Program and also in one of the correct repayment plans to avail this public service loan forgiveness program. This program is often confused with Obama’s student loan forgiveness while the updates in the later also affect the PSLF.

Advantages of President Obama’s Plan:

  • The Obama’s student loan forgiveness program has made positive updates on the Public service loan forgiveness program. The 20 years loan debt payment has been reduced to 10 years after which complete loan forgiveness is given.
  • The Pay As You Earn (PAYE) policy introduced by Obama has given fruitful help to the student who later work. It is the income based repayment plan and helps the people to get loan forgiveness earlier.

Disadvantages of President Obama’s Plan:

  • You must be a new borrower from October 1st, 2007. The loan which was taken earlier to October 1st, 2007 are not qualified to the Pay As You Earn policy. That means a lot of students still need to undergo the hardship in spite of taking a Federal Student Loan.

New borrower means the applicant should be utilizing the loan forgiveness option only after or on October 1st 2007. Nurses who have availed the educational loan earlier to this particular date do not have the eligibility to avail the loan forgiveness program.

  • You must also take the partial hardship of completing the loan. This means the amount you are going to repay within the 10 year as per the loan repayment policy should be higher than the Pay as you earn plan. So the people with older loans cannot avail this new repayment plan.

Partial hardship means the applicant of the loan gets to bear the debt amount repayment till a certain period of time. In this case it is reduced to 10 years from initial 20 years. Post 10 years the long is completely forgiven and the federal government takes care of it.

If you are a qualified nurse who is looking for a loan forgiveness, we hope this post helped you with your quest!

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