What Are Good Federal Stafford Student Loan Forgiveness Programs?

Here is the next installment in our the Reader’s Questions Series which highlight questions emailed to me by you, the readers of Money Q&A. Be sure to find out at the end of this article how you can receive a free copy of Dave Ramsey’s book, The Total Money Makeover if your money question is chosen to be featured on an upcoming week’s blog post.

A reader recently wrote in with the following question about his student loans and forgiveness.

Is there a way to have my federal Stafford Loan forgiven?

There are several instances where you may qualify for loan forgiveness of your federal Stafford Loan. What makes up good student loans forgiveness programs? Student Debt Relief also has a great tool for checking student loan forgiveness eligibility that you might want to check out.

Refinance federal and private student loans at SoFi.com today!

Good Federal Stafford Student Loan Forgiveness Programs?

Teach in Lower Income Districts

Good Federal Stafford Student Loan Forgiveness Programs?If you took out a federal Stafford Loan on the first part of October 1998 or later, then you may qualify to have a portion of your loan amount erased. People who have taught in school districts that are considered lower income can have their debt extinguished if they’ve worked in the school system for at least five years. Check with your lender for further details.

Child Care Providers – A Program That Helps With Educational Costs

People who have acquired a 2-year or 4-year early childhood degree can also have some of their debt forgiven and expunged. If you’ve worked at least a couple years in a childcare capacity for a facility in a lower income neighborhood and took out a Stafford loan after the 7th of October 1998, you may, in all likelihood, be an eligible candidate.

Features of the Child Care Provider Loan Forgiveness Program

Designed to create more jobs in the field of early childcare, the student loans forgiveness programs stipulate that eligible borrowers can have 20% of the amount of their loan(s) forgiven when they work for two years in a specific facility. In addition, eligible participants can erase 20% more off of their loan amount in some cases. Those cases are if they work a third year, and another 30% each year up to five consecutive years of service.

Erasing Loan Debts In The Nursing Occupation

The NELRP or Nursing Education Loan Repayment Program is also a program that can erase any outstanding loan amounts for individuals in the field of nursing. Its primary purpose is to help alleviate nursing shortages in non-profit health facilities. Therefore, candidates must meet certain criteria.

By working in one of these facilities for a couple years full-time (32 hours), nurses can receive 60% of the loan balance. If they stay in a facility for three years, they can obtain another 25 percent of the borrowed amount.

To be eligible for the program, you should be a nurse who has received a diploma, associate, bachelor or graduate degree in nursing from an accredited school and work in certain facilities on a full-time basis. U.S. citizenship is required or resident status must be proven.

Non-Profit Facilities Covered in the Program

Candidates for the student loans forgiveness programs generally work in facilities where nurses are sought. These can be hospitals, Federal healthcare centers, the Human Services Department, state and local health departments, nursing homes, hospices, and other sites. They can also be skilled nursing facilities, health agencies designated for home care, and ambulatory surgery centers.

Favored Candidates

Loan companies may give you initial approval over other candidates if you have completed your nursing education and owe 40% or more of your yearly income on your loan. And, if you work at specific facilities, such as critical access hospitals, rural health clinics, nursing homes, state or local public health agencies, or where the nursing shortages are the greatest, loan companies may give you initial approval over other candidates.

Make Sure You Are Serious About Working as a Nurse

You can make application to NELRP on an annual basis at the start of February or March, with deadlines set in March or April. Remember, you must have completed two years of service at the above-noted facilities.

Also, you should make sure you are dedicated to working as a nurse. You should follow through with respect to the guidelines mandated by the program if you don’t want to suffer significant repercussions financially.

If you are currently a nurse, teacher or childcare provider, who meets the above criteria, then you stand to gain financially by taking advantage of the above programs.

Past Readers’ Questions:

Do you have a money question that you would like to ask? Email me your money, investing, retirement, savings, or other question to Questions[at]MoneyQandA.com. If I pick your question for the next article in the series, I’ll send you a free copy of Dave Ramsey’s book, The Total Money Makeover, .


3 thoughts on “What Are Good Federal Stafford Student Loan Forgiveness Programs?”

  1. Student loans really helps you to get your higher education. One of the best benefit of it is the fact that multiple loans can be melted down into one master loan. This saves frustration, reduces the risk of missing a payment and actually improves your credit score. And it reduces your monthly payment.

  2. You can absolutely do that, however, if I were you and were still a student, I would hold out on paying a subsidized loan. Subsidized loans do not increase with any interest while you’re in school, but it is the UN subsidized that does. There are no setbacks from having loans while applying for next year’s loans.

  3. Special education teachers can have a total of 17,500 eliminated while general education teachers can have up to 5,000.


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