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  • Writer's pictureNathan Zarcaro

Social Worker Student Loan Forgiveness: 5 Reasons to Pick PSLF Over NHSC

Updated: Nov 27, 2023


Social workers are some of America’s most essential workers. They are trusted to improve the lives of their patients by helping them manage stress and cope with whatever lives throws their way.

Becoming a social worker is no easy task, either. It takes years of education, and many incur tens or hundreds of thousands of dollars in student loan debt as a result.

Thankfully, social workers in the United States may participate in either the NHSC or PSLF student loan forgiveness.



Student loan forgiveness for social workers


Social workers across the country may qualify to participate in the following programs:


  1. Public Service Loan Forgiveness

  2. National Health Service Corps Loan Repayment Assistance Program



1. Public Service Loan Forgiveness


Public service professionals, social workers included, that work for the federal/state/local government or qualifying non-profit organization may opt to participate in the Public Service Loan Forgiveness Program, also known as PSLF.


To qualify for PSLF, social workers must:


  1. Have qualifying Direct Loans (or consolidated other loan types through a Direct Consolidation Loan)

  2. Join an income-driven repayment plan (SAVE Plan)

  3. Make 120 reduced, qualifying monthly payments


These requirements can be confusing to sift through, so the federal government has produced a PSLF Help Tool to assist. Getting a customized student loan plan from a CFP or CFA over at Student Loan Planner can be another great option.


Since you'll need to join a participating income-driven repayment plan, you can expect your payments to be reduced while you pursue forgiveness! PSLF program participants also need to remember to recertify their income each year, as your income will determine what these reduced payments will be.




2. NHSC Loan Repayment


Social workers may also opt for the NHSC Loan Repayment program, which awards program participants with up to $50,000 in student loan forgiveness after completing two years of full-time service ($25,000 for part-time service).


Additional forgiveness may be available after the two-year service commitment through continuation contracts, though they are not guaranteed.



NHSC LRAP eligibility


Qualifying for the NHSC LRAP requires participants to be:


  • A citizen or legal national of the United States

  • A healthcare provider supporting Medicare, Medicaid, and/or state CHIP programs for children

  • Fully licensed and trained to practice medicine


In addition to social work, providers in the following disciplines are eligible at this time: MDs, DOs, PAs, NPs, DDSs, DMDs, Dental Hygienists, HSPs, LCSWs, PNSs, MFTs, LPCs, and CNMs.


Most loans offered by federal or private lenders qualify, with the exception of:


  • Primary Care Loans

  • Parent Plus Loans

  • Other types of debt or personal loans



Other NHSC forgiveness programs


Under this forgiveness programs, social workers may actually choose from a few other NHSC programs that make up the NHSC LRAP:




5 reasons for social workers to use PSLF


We believe that social workers should use Public Service Loan Forgiveness over NHSC Loan Repayment Assistance Program for five main reasons:


  1. Access to federal loan benefits

  2. Employer flexibility

  3. Multiple career paths eligible

  4. Potential for 100% forgiveness

  5. Lower present monthly payments



1. Access to federal loan benefits


Social workers participating in the PSLF program must have federal student loans to do so. This means that borrowers maintain access to perks such as deferment and forbearance options that may not be available to those with federal debt.


Federal borrowers may also use NHSC Loan Repayment, though social workers with private loans will need to use it if they want forgiveness, since they won't be eligible for PSLF.


But by not refinancing prior to pursuing forgiveness, you'll leave yourself more options in the event that you lose your job or otherwise need to take a break from making your payments for a period of time.



2. Employer flexibility


PLSF may also be a better option for social workers because of the additional flexibility in terms of your employer.


Remember – under the NHSC loan repayment assistance program, you need to be employed at an NHSC eligible site in a designated health professional shortage area (HPSA).


That is a very nuanced eligibility requirement that can be very difficult to meet.

With the PSLF program, you just need to make sure you work for an eligible employer. Plus, the federal government offers a PSLF eligible employer search to help the process easier!


Without this nuanced geographic eligibility requirement, more social workers living in or near cities will earn needed student loan relief.



3. Opportunities for social workers in different fields


As an extension of employer flexibility, PSLF offers program access to social workers working in different fields and niches.


For instance, those working in areas such as child welfare, education, behavioral health, or healthcare may participate in the program, so long as their employer qualifies.


By doing so, the federal government acknowledges the wide array of contributions that social workers make in all different fields. This allows social workers on PSLF to grow professionally and switch roles as they participate in the forgiveness program, so long as they work for another qualifying employer.


This is also good for patient outcomes, since social workers unhappy with their roles won't need to stay to prevent the loss of forgiveness benefits.



4. Potential for 100% forgiveness


PSLF may also forgive 100% of your remaining student loan debt, so long as your outstanding debt is federal in nature and covered under the Federal Direct Loan program.


Since many social workers are highly educated, they are far more likely to have higher levels of student loan debt than the general public. This means that NHSC assistance may not eliminate as much of your outstanding student debt as you may hope.


A social worker with $150,000 in student loans may love the immediate impact that $50,000 in NHSC forgiveness can provide, but they'll still be left with a huge balance and the prospect of making an additional 120 payments prior to earning forgiveness through PSLF.


But by starting with PSLF immediately, those with the highest balances will be able to eliminate their student loans more quickly.



5. Lower monthly payments in the present


Under the terms of the NHSC program, social workers will still face their normal monthly payments as they pursue student loan forgiveness. This can cause stress, even for those that received funds and complete their service obligations.


The advantage that PSLF offers is that you'll find yourself with reduced monthly payments as you pursue forgiveness. This is because you'll need to join a qualifying income-driven repayment plan, most likely President Biden's new Saving on a Valuable Education plan.



Get a student loan plan


If you're stuck and unsure where to turn next, I highly recommend you check out my friends over at Student Loan Planner. Travis and company offer student loan consultations, and they'll be able to help you plan out your next moves.


Plus, they've consulted on $1 out of every $1,000 dollars in student debt nationwide, so they're highly experienced at what they do!



Conclusion


Social workers across the country help children and families live better lives every day. This expertise requires years of expensive education, so it is nice to see social workers eligible for both the PSLF and NHSC Loan Repayment programs.


Ultimately, one of these programs is likely to be more advantageous for you, but many social workers will find PSLF to be of great help to them.


Are you a social worker considering one of these student loan forgiveness programs? Type your comments or questions in the chat below and I'll answer them!



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About Nathan Zarcaro

Nathan Zarcaro is the founder of The Student Debt Destroyer and is passionate about personal finance related causes.  A 2018 graduate of Providence College's Liberal Arts Honors Program, Nathan studied Finance, and has worked for industry leaders in both finance and healthcare.  In his free time, Nathan enjoys playing golf and traveling with his wife Brigid.

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