Nursing School Debt: A Repayment Guide for Nurses

Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.

Editorial Note: This content is not provided or commissioned by any financial institution. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by the financial institution.

nursing loans
Logo

We’ve got your back! Student Loan Hero is a completely free website 100% focused on helping student loan borrowers get the answers they need. Read more

How do we make money? It’s actually pretty simple. If you choose to check out and become a customer of any of the loan providers featured on our site, we get compensated for sending you their way. This helps pay for our amazing staff of writers (many of which are paying back student loans of their own!).

Bottom line: We’re here for you. So please learn all you can, email us with any questions, and feel free to visit or not visit any of the loan providers on our site. Read less

Note that the government is allowing an interest-free pause for repayment on most federal student loans through the end of September 2020 to help ease the impact of the coronavirus pandemic. Many other lenders and servicers are also offering relief options during this time. Check out our Student Loan Hero Coronavirus Information Center for more.

*         *         *

A career in nursing is a great choice for many reasons: You get to help people and earn a good salary. In fact, the mean salary for a registered nurse in May 2019 was around $77,460 a year, according to the Bureau of Labor Statistics.

But despite those positives, there’s one major drawback: nursing school loans. According to a 2017 report from the American Association of Colleges of Nursing (AACN), graduate-level nursing students said they expected to leave their program with a median debt of $40,000 to $54,999.

If you’re feeling the burden of paying off your student loans, know you have options. Here are some general tips and nursing school loan repayment options to consider.

How to pay off nursing loans
Student loan forgiveness for nurses
Nursing loan repayment assistance programs by state
Paying back your nursing school loans

How to pay off nursing loans

In 2016, 69% of graduate nursing students took out federal loans, according to the AACN report. These loans are put on a 10-year Standard Repayment plan. But you have other ways of repaying your federal debt.

Graduated Repayment Plan

With this plan, your payments start at a lower amount and then increase about every two years. Although you’ll still pay off your loan in 10 years, this repayment plan makes it easier to afford your payments when you’re first starting out.

Extended Repayment Plan

You must have over $30,000 worth of Direct Loans or Federal Family Education Loans (FFEL) to qualify for this repayment plan. Payments can either be fixed or graduated. Although you’ll end up paying more overall, your loan will be paid off within 25 years.

Income-driven repayment (IDR) plans

Among graduate nursing students who took out federal student loans, only 22% surveyed by the AACN planned to take advantage of an IDR plan.

Enrolling in an IDR plan could lower your monthly payments since the amount you pay would be based on a percentage of your discretionary income. You might not even have to make a payment. This is especially helpful if you’re just starting your nursing career and don’t have extra cash available.

Here are the four main options available:

Remember that eligibility requirements vary by option. Your repayment period would also become either 20 or 25 years. That could mean you’ll be in debt longer and pay more in interest over time.

Direct Consolidation Loan

If you took out multiple federal loans, you could combine them with a Direct Consolidation Loan. That way, you’d have only one monthly payment to make. Although you’d lower your monthly payments, your interest rate could rise with a Direct Consolidation Loan.

Further, if you’ve been working toward loan forgiveness under an IDR plan or through another program, consolidating your loans would erase your progress.

Refinancing nursing school loans

Even if you scored some grants and scholarships, you might have taken out nursing loans to fill a funding gap. Whether you have federal or private student loans, refinancing can help you reduce your payments and interest charges.

With student loan refinancing, you take out a new loan with a private lender to pay off existing education debt. You could get a better interest rate or repayment schedule on the new loan. But there are many pros and cons of refinancing to consider.

Here are some benefits to refinancing your nursing loans:

  • You could get a lower interest rate: One of the main reasons to refinance your loans is to reduce the interest you pay over time. Shopping around to find a lender who will give you a lower rate than your current one could lead to major savings.
  • Consolidate monthly payments: If you have multiple student loans, you could combine them into one loan. You’d then have only one monthly payment to manage.

But, you should consider some drawbacks before taking out a new loan:

  • Repayment terms aren’t as flexible: Federal student loans have many repayment plan options. If you refinanced your federal education debt into a private loan, you’d lose access to IDR plans.
  • You lose access to federal protections: Private loans aren’t eligible for federal forbearance, deferment or forgiveness programs.

Student loan forgiveness for nurses

If you have federal education debt from nursing school, you could qualify for these student loan forgiveness programs:

Public Service Loan Forgiveness (PSLF)

The AACN report found that 57% of surveyed nurses planned to take advantage of Public Service Loan Forgiveness. Under this program, you could have certain federal debt forgiven after you make 120 qualifying payments.

To be eligible for this program, you must work full time for a qualifying employer, such as a government or nonprofit organization. You should also be making payments under an IDR plan.

Only Direct Loans qualify for PSLF. If you have an FFEL or Perkins Loan, you’ll need to consolidate it into a Direct Consolidation Loan before the payments you make would qualify for PSLF. Note that any payments you made on an FFEL or Perkins Loan before consolidation won’t count toward PSLF.

Be sure that using this program is worth the 10 years of service. You can do this by using our PSLF calculator.

Federal Perkins Loan cancellation

Have a Federal Perkins Loan? Work full time as a nurse? Then 100% of your loan could be canceled or discharged.

To qualify for Perkins Loan cancellation, you must work full time as a nurse or medical technician and provide services directly to patients.

To have your Perkins Loan discharged, you must meet one of these conditions:

  • Bankruptcy
  • School closure
  • Total and permanent disability
  • Disability due to military service
  • Spouse of a victim of 9/11

It’s important to note that the Perkins Loan program expired on Sept. 30, 2017. So, you must have borrowed before that date to be eligible.

Military repayment programs for nursing loans

Members of the armed forces could qualify for certain military repayment programs. Consider the following.

Air Force Active Duty Health Professions Loan Repayment Program (ADHPLRP)

The Air Force needs medical professionals and seeks out nurses. To incentivize nurses into the military, the ADHPLRP offers student loan repayment up to $40,000. This is in exchange for a minimum of two years of active-duty obligation or one year for each annual payment, whichever is greater.

Health Professionals Loan Repayment Program (HPLRP)

Nurses can get repayment assistance of a maximum of $40,000 per year minus taxes. Among other criteria, you’ll need to serve in the armed forces as an officer in the selected reserve. Only certain loans, such as those in the Direct Loan Program, are eligible. Be sure to check if your loans qualify.

Active Duty Health Professions Loan Repayment Program

Through the Army, nurses can get up to $120,000 (or $40,000 a year) of loan repayment for three years of service. You can also get a sign-up bonus of up to $10,000. That will certainly make a dent in your student loan debt.

Healthcare Professional Loan Repayment Program

As a member of the health care team for the U.S. Army Reserve, you could earn up to $50,000 in nursing loans repayment. Only selected specialties who enlist for six years meet the criteria. You might also be eligible to participate in another incentive program.

Other government-sponsored repayment programs

In addition to offering loan forgiveness and repayment for military service, the government has other programs to help you repay your nursing school debt.

National Health Service Corps (NHSC) Loan Repayment Program

In an attempt to bring better medical care to underserved areas, the NHSC has a program that pays up to $50,000 toward your loans in exchange for two years of service. The amount repaid on your nursing loans is dependent on the area you serve.

The Indian Health Service (IHS) Loan Repayment Program

IHS clinicians who serve American Indian or Alaska Native communities can get help repaying student debt. In exchange for two years of service, you can earn up to $40,000 in loan repayment. You might be eligible for more money with additional service.

NURSE Corps Loan Repayment Program

In exchange for working full time for two years in a high-need facility, you can get up to 60% of your student loan debt forgiven. An additional 25% of your original balance can be forgiven for your third year of service.

Nursing loan repayment assistance programs by state and employer

There are many state-sponsored programs that help nurses pay back student loans. Check out these student loan forgiveness programs for nurses. Just know that these programs can change and are dependent on funding.

In addition, seek out hospitals and other medical industry employers that offer student loan repayment assistance, either as a signing bonus to entice you to accept a job offer or as a 401(k)-style matching benefit. Consult Johnson & Johnson’s directory of such employers.

Paying back your nursing school loans

Although you might be overwhelmed with student loan debt from nursing school, you should feel more confident knowing that there are a ton of loan repayment options. Whether you choose a federal repayment plan, refinance or consolidate your loans or sign up for a military program, reducing your debt is possible.

Andrew Pentis contributed to this report.

Interested in refinancing student loans?

Here are the top 6 lenders of 2020!
LenderVariable APREligible Degrees 
1.99% – 5.64%1Undergrad
& Graduate

Visit Earnest

1.89% – 5.90%2Undergrad
& Graduate

Visit Laurel Road

2.25% – 6.28%3Undergrad
& Graduate

Visit SoFi

1.89% – 6.77%4Undergrad
& Graduate

Visit Splash

2.39% – 6.01%Undergrad
& Graduate

Visit Elfi

1.99% – 5.61%5Undergrad
& Graduate

Visit CommonBond

Check out the testimonials and our in-depth reviews!
1 Important Disclosures for Earnest.

Earnest Disclosures

To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.

Earnest fixed rate loan rates range from 2.98% APR (with Auto Pay) to 5.79% APR (with Auto Pay). Variable rate loan rates range from 1.99% APR (with Auto Pay) to 5.64% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of July 31, 2020, and are subject to change based on market conditions and borrower eligibility.

Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.

The information provided on this page is updated as of 7/31/2020. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at [email protected], or call 888-601-2801 for more information on our student loan refinance product.

© 2020 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.


2 Important Disclosures for Laurel Road.

Laurel Road Disclosures

All credit products are subject to credit approval.

Laurel Road began originating student loans in 2013 and has since helped thousands of professionals with undergraduate and postgraduate degrees consolidate and refinance more than $4 billion in federal and private school loans. Laurel Road also offers a suite of online graduate school loan products and personal loans that help simplify lending through customized technology and personalized service. In April 2019, Laurel Road was acquired by KeyBank, one of the nation’s largest bank-based financial services companies. Laurel Road is a brand of KeyBank National Association offering online lending products in all 50 U.S. states, Washington, D.C., and Puerto Rico. All loans are provided by KeyBank National Association, a nationally chartered bank. Member FDIC. For more information, visit www.laurelroad.com.

As used throughout these Terms & Conditions, the term “Lender” refers to KeyBank National Association and its affiliates, agents, guaranty insurers, investors, assigns, and successors in interest.

  1. Checking your rate with Laurel Road only requires a soft credit pull, which will not affect your credit score. To proceed with an application, a hard credit pull will be required, which may affect your credit score.
  2. Savings vary based on rate and term of your existing and refinanced loan(s). Refinancing to a longer term may lower your monthly payments, but may also increase the total interest paid over the life of the loan. Refinancing to a shorter term may increase your monthly payments, but may lower the total interest paid over the life of the loan. Review your loan documentation for total cost of your refinanced loan.
  3. After loan disbursement, if a borrower documents a qualifying economic hardship, we may agree in our discretion to allow for full or partial forbearance of payments for one or more 3-month time periods (not to exceed 12 months in the aggregate during the term of your loan), provided that we receive acceptable documentation (including updating documentation) of the nature and expected duration of the borrower’s economic hardship. During any period of forbearance interest will continue to accrue. At the end of the forbearance period, any unpaid accrued interest will be capitalized and be added to the remaining principle amount of the loan.
  4. Automatic Payment (“AutoPay”) Discount: if the borrower chooses to make monthly payments automatically from a bank account, the interest rate will decrease by 0.25% and will increase back if the borrower stops making (or we stop accepting) monthly payments automatically from the borrower’s bank account. The 0.25% AutoPay discount will not reduce the monthly payment; instead, the discount is applied to the principal to help pay the loan down faster.

Assumptions: Repayment examples above assume a loan amount of $10,000 with repayment beginning immediately following disbursement. Repayment examples do not include the 0.25% AutoPay Discount.

Annual Percentage Rate (“APR”): This term represents the actual cost of financing to the borrower over the life of the loan expressed as a yearly rate.

Interest Rate: A simple annual rate that is applied to an unpaid balance.

Variable Rates: The current index for variable rate loans is derived from the one-month London Interbank Offered Rate (“LIBOR”) and changes in the LIBOR index may cause your monthly payment to increase. Borrowers who take out a term of 5, 7, or 10 years will have a maximum interest rate of 9%, those who take out a 15 or 20-year variable loan will have a maximum interest rate of 10%.

KEYBANK NATIONAL ASSOCIATION RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE.

This information is current as of September 9, 2020. Information and rates are subject to change without notice.
 


3 Important Disclosures for SoFi.

SoFi Disclosures

  1. Student loan Refinance: Fixed rates from 2.99% APR to 6.28% APR (with AutoPay). Variable rates from 2.25% APR to 6.28% APR (with AutoPay). Interest rates on variable rate loans are capped at either 8.95% or 9.95% depending on term of loan. See APR examples and terms. Lowest variable rate of 2.25% APR assumes current 1 month LIBOR rate of 0.18% plus 2.32% margin minus 0.25% ACH discount. Not all borrowers receive the lowest rate. If approved for a loan, the fixed or variable interest rate offered will depend on your creditworthiness, and the term of the loan and other factors, and will be within the ranges of rates listed above. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. See eligibility details. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. *To check the rates and terms you qualify for, SoFi conducts a soft credit inquiry. Unlike hard credit inquiries, soft credit inquiries (or soft credit pulls) do not impact your credit score. Soft credit inquiries allow SoFi to show you what rates and terms SoFi can offer you up front. After seeing your rates, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit inquiry. Hard credit inquiries (or hard credit pulls) are required for SoFi to be able to issue you a loan. In addition to requiring your explicit permission, these credit pulls may impact your credit score. Terms and Conditions Apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. 

4 Important Disclosures for Splash Financial.

Splash Financial Disclosures

Terms and Conditions apply. Splash reserves the right to modify or discontinue products and benefits at any time without notice. Rates and terms are also subject to change at any time without notice. Offers are subject to credit approval. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet applicable underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates are reserved for the highest qualified borrowers. If approved, your actual rate will be within a range of rates and will depend on a variety of factors, including term of loan, a responsible financial history, income and other factors. Refinancing or consolidating private and federal student loans may not be the right decision for everyone. Federal loans carry special benefits not available for loans made through Splash Financial, for example, public service loan forgiveness and economic hardship programs, fee waivers and rebates on the principal, which may not be accessible to you after you refinance. The rates displayed may include a 0.25% autopay discount.

The information you provide to us is an inquiry to determine whether we or our lenders can make a loan offer that meets your needs. If we or any of our lending partners has an available loan offer for you, you will be invited to submit a loan application to the lender for its review. We do not guarantee that you will receive any loan offers or that your loan application will be approved. Offers are subject to credit approval and are available only to U.S. citizens or permanent residents who meet applicable underwriting requirements. Not all borrowers will receive the lowest rates, which are available to the most qualified borrowers. Participating lenders, rates and terms are subject to change at any time without notice.

To check the rates and terms you qualify for, Splash Financial conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, the lender will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

Splash Financial and our lending partners reserve the right to modify or discontinue products and benefits at any time without notice. To qualify, a borrower must be a U.S. citizen and meet our lending partner’s underwriting requirements. Lowest rates are reserved for the highest qualified borrowers. This information is current as of September 10, 2020.


5 Important Disclosures for CommonBond.

CommonBond Disclosures

Offered terms are subject to change and state law restriction. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900), NMLS Consumer Access. If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown. ‍All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 0.16% effective Sep 1, 2020 and may increase after consummation.

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print to help you understand what you are buying. Be sure to consult with a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time.