Updated on 10.23.14

Student Loan Forgiveness: Jobs That Pay Off Your Debt

Teacher talking to students

It sounds too good to be true, but teachers, nurses, and others can get a portion of their student loans erased.

Dealing with student loan debt can seem unbearable and overwhelming. As mentioned in 15 Ways To Deal with Student Loan Debt, the average student owes a whopping $40,000 after graduation — but almost one in five students owes $50,000 or more, and 5.6 percent owe over $100,000.

Maybe you worked hard to save money in college, diligently keeping your student loan debt in mind. Maybe you made some huge financial mistakes during college and ended up taking out much more than you imagined. Whatever road you took to amass this student loan debt, now is the time to start planning your exit route.

One idea often thrown around when talking about student loan debt is the option of Student Loan Forgiveness. Student Loan Forgiveness is simply what it sounds like – a portion of your student loan debt gets forgiven, and you no longer owe that set amount of money. Pretty sweet, right?

Many people don’t explore this “too good to be true” option since they don’t know about it, they don’t understand it, or they don’t think they’d qualify for such an amazing benefit. That is exactly why I decided to do this Student Loan Forgiveness series, exploring different ways you can eliminate some or all of your student loan debt. This week, we look at careers that offer loan forgiveness.

Choosing a Job with Student Loan Forgiveness

Before you get too excited at the idea of getting a portion of your loans wiped out, consider the positive and negative things about opting for a job that offers student loan forgiveness.

Pros

  • Besides alleviating some of the student loan burden you have, these positions also offer a salary, unlike volunteering.
  • You’re earning cash, gaining work experience, and building a resume all while earning extra money toward your student loans.
  • In many situations, you are also getting the opportunity to work in areas or fields where you are desperately needed and can really make a difference in people’s lives.

Cons

  • Many positions offer loan forgiveness as an incentive — this can mean that other people don’t want to work there for some reason. It could be because the job pays a lower salary, the working conditions are harder, the location isn’t desirable, or other factors. So you’ll want to consider where you’ll be living, the work environment, and what you’ll be doing on a day-to-day basis. Imagine yourself in the situation before jumping in.
  • Opportunities often come with rigid guidelines about who qualifies, what type of loans qualify, and how long you have to work there before you receive assistance. Some programs require you to keep making payments. If you break your contract, you may no longer receive any assistance.
  • Some positions may require you to relocate, which could add both extra expense and stress.

Career-Based Student Loan Forgiveness Programs

Public Service Loan Forgiveness

Consider getting a full-time public service job within federal or local government, or at a nonprofit organization that’s designated tax-exempt by the IRS.

Even some private nonprofits that are not tax-exempt organizations can qualify if they provide certain public services. Some of these include military service, emergency management, public safety, law enforcement services, public health services, public education, public library services, public interest law services, public service for elderly or those with disabilities, or early childhood education.

If you continue to make 120 qualifying payments (10 years’ worth) under the Standard, Income-Based, Income-Contingent, or Pay As You Earn repayment plans while you’re working full-time, you may qualify for forgiveness of your remaining student loan balance. Payments must be received on time and be made while you are working at the qualifying public service organization.

Qualifying loans include:

  • Direct Stafford loans
  • Direct Parent and Grad PLUS loans
  • Direct Consolidation loans

View the U.S. Department of Education website for more information on how to apply for Public Service Loan Forgiveness.

SEMA Loan Forgiveness Program

This forgiveness is for those in the automotive aftermarket industry. To qualify, you need to have worked full-time for a minimum of one year at a Specialty Equipment Market Association (SEMA) member company at the time you apply, and have successfully completed a program of study at an accredited college or technical program with a minimum 2.5 grade point average.

You can receive $2,000 towards your student loans.

Qualifying loans include:

  • Stafford loans
  • Consolidation loans
  • Parent loans
  • Grad PLUS loans

For additional information or for contact information, visit their website.

Teacher Loan Forgiveness Program

If you teach full-time for five consecutive years in specific school serving low-income families, you can be eligible for student loan forgiveness. You must have taken out your loans prior to the end of your five-year teaching service.

You may be eligible to receive $5,000 a year up to $17,500.

You can also receive Teacher Cancellation, which is different than Loan Forgiveness. If you have a loan from the Federal Perkins Loan Program, you can qualify for up to 100 percent of a Federal Perkins loan cancellation.

Qualifying loans include:

  • Direct Subsidized Loans
  • Direct Unsubsidized Loans
  • Subsidized Federal Stafford loans
  • Unsubsidized Federal Stafford Loans
  • Consolidation loans

Visit the U.S. Department of Education’s website for more information on this program, including eligibility requirements and how to apply.

USDA Veterinary Medicine Loan Repayment Program

If you’re a qualified veterinarian and willing to serve in a high-priority veterinary shortage situations for a specific amount of time, you can be eligible for this repayment plan.

You may be eligible to receive $25,000 per year toward your student loan debt for a 3-year commitment in the shortage area.

Qualifying loans include:

  • Stafford loans
  • Grad PLUS loans
  • Parent PLUS loans
  • Consolidation loans
  • Perkins loans
  • Private student loans
  • State loans

For more information on how to apply for this program, visit the USDA’s website.

Legal Practice Student Loan Forgiveness

There are Loan Repayment Assistance Programs, also known as LRAPs, for lawyers interested in pursuing a job in a public interest position. According to AmericanBar.org, there is often an income cap on what you can be earning while you’re receiving any type of loan assistance.

These loan assistance plans can include student debt forgiveness or lower payments on the loan. Visit the American Bar Association’s website for more information about these opportunities.

If you are a lawyer and would be willing to serve in public interest or nonprofit positions, you can also contact Equal Justice Works for information on whether or not your school would offer student loan forgiveness.

Faculty Loan Repayment Program (FLRP)

Health professionals from disadvantaged backgrounds serving on the faculty at an accredited health profession college or university can participate in this loan repayment program.

You’ll receive $40,000 for two years of service for teaching full- or part-time at an accredited health school.

Qualifying disciplines include: Allopathic Medicine, Osteopathic Medicine, Veterinary Medicine, Dentistry, Pharmacy, Optometry, Nursing, Public Health, Physician Assistant, Clinical Psychology, Clinical Social Work, Marriage and Family Therapy, Professional Counseling, Dental Hygiene, Medical Laboratory Technology, Occupational Therapy, Speech Pathology, Audiology, and Registered Dietitian.

Qualifying loans include:

  • Stafford loans
  • Grad PLUS loans
  • Consolidation loans
  • Perkins loans
  • Private student loans

For more information, visit the U.S. Dept. of Health and Human Services website.

National Institute of Health Loan Forgiveness

If you’re a health professional with a doctoral degree, you may be eligible for this loan forgiveness program. You’ll need to pursue a career in biomedical, behavioral, social, or clinical research for two years funded by a domestic nonprofit organization or U.S. federal, state, or local government entity.

Doctoral degrees include: M.D., Ph.D., Pharm.D, Psy.D., D.O., D.C., N.D., D.D.S., D.M.D., D.V.M., O.D., and D.P.M.

Your total debt needs to be equal to or greater than 20 percent of your base salary, and you’ll need to be working with this research for at least 20 hours per week.

You may receive up to $35,000 of student loan forgiveness per year.

Qualified loans include:

  • Stafford loans
  • Grad PLUS loans
  • Consolidation loans
  • Perkins loans
  • State-issued loans
  • Academic institutions loans
  • MEDLOANS
  • Private student loans

For more information, visit the National Institutes of Health website.

NURSE Corps Loan Repayment Program

If you are a licensed nurse and willing to work in a registered nurse shortage area, you can receive up to 60 percent of your loans paid for two years of service, and up to 85 percent paid for three years of service.

You’ll need to work full-time (at least 32 hours per week), and you’ll be considered ineligible if you have defaulted on any federal payment obligations.

Qualifying loans

  • Stafford loans
  • Grad PLUS loans
  • Consolidation loans
  • Perkins loans
  • Private student loans

For more information, visit the program’s website.

IHS Loan Repayment Programs

The Indian Health Service (IHS) is a federal health program for American Indians and Alaska natives. To be eligible for this award, you commit to work full-time in an Indian health program site for two-years. These sites are dedicated to providing care to American Indian and Alaska native communities.

Eligible health profession fields vary greatly and include: Acupuncturist, Chemical Dependency Counselors, Dental Assistants, Environmental Engineering, Medical Laboratory Technician, Diagnostic Radiology Tech, Optometry, Chiropractic, Physician Assistant, and many more.

You can be then eligible to receive up to $40,000 toward the repayment of your qualified student loans. According to the IHS website, loans are “government and commercial loans used to pay for health professional school-related expenses including tuition, fees, books, lab expenses, and reasonable living expenses.”

For more information on how to apply and how the program works, visit the IHS website.

NHSC Loan Repayment Program

The National Service Health Corps offers student loan debt relief to health care providers who are willing to practice in an area where they are needed. You’ll need to be a licensed primary care medical, dental, or behavioral health care worker.

Participants need to work at an NHSC-approved site for two years. Those who serve for two years at a Health Professional Shortage Area (HPSA) with a level of 14 or above can receive $50,000 toward their student loans. Those working at a site with an HPSA level of 12 or below can receive $30,000 for two years of service.

For more information on this program, visit the NHSC website.

The State Loan Repayment Program

The State Loan Repayment Program, also known as SLRP, is similar to the NHSC Loan Repayment Program. Both offer loan forgiveness to practicing, licensed health care professionals who work in designated areas with health care professional shortages.

However, this program is run through your individual state. Not all states participate, and each has its own set of eligibility requirements. Service completion requirements, the amount of student loan debt that can be repaid, and how long you’ll need to work in the designated area can all vary by state. For example, Colorado requires three years of service as opposed to the two years required by the NHCS program.

To see if your state participates in this program, and to find out more about the application process, visit the U.S. Dept. of Health and Human Services website.

Things to Keep in Mind

  • Thoroughly research any opportunity before signing up. If you’re considering a specific program, do your homework: Try to talk to someone who has participated in the program, or find an expert on the requirements who can answer your questions.
  • Be sure your loans qualify. Many loan forgiveness opportunities only apply to certain types of loans. But that’s not the only catch: Some programs have stipulations on how those loans were used — did all of the money go toward tuition, or did you use some of it for living expenses? Loans with missed payments or those that were in default are often ineligible, and some programs have regulations about how much debt you need to have. Talk to your loan lender.
  • Consider the pros and cons of the positionLike all the other student loan forgiveness opportunities, don’t jump in. Know exactly what you’ll be doing, take stock of the sacrifices you may need to make, and of course, know the conditions of the loan forgiveness.

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