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  • Writer's pictureNathan Zarcaro

Student Loan Forgiveness in Maryland [2023]

Updated: Oct 23, 2023


Maryland is one of America's most beautiful states. Baltimore's inner harbor, the beauty of Annapolis, world famous crabbing, and proximity to the United States Capitol are just a few of the things that make Maryland so beloved.


The state's beauty comes with a financial trade-off, however. Unfortunately, Maryland has the highest outstanding student loan balance of any of the fifty states, at an average remaining balance of over $39,000, according to Student Loan Hero.


Fortunately for its residents, though, the state of Maryland has a number of state-specific student loan forgiveness programs to lessen the financial burden of student debt.



Maryland student loan forgiveness calculator


Student loan debt in Maryland


We've already mentioned that Marylanders have the highest average outstanding student debt balance of any state in the country. But the numbers go deeper than that. Before President Biden's forgiveness announcement, Maryland had 900,000 outstanding borrowers that cumulatively owed $37.1 billion, according to Student Loan Hero.


Of MD's largest counties, those in Montgomery County had the highest balances remaining, followed by Anne Arundel County.



Federal forgiveness programs in Maryland


Residents of the great state of Maryland have access to the Department of Education's full gambit of forgiveness programs. Plans worth considering include:


  1. Public Service Loan Forgiveness (PSLF)

  2. Income-Driven Repayment (IDR)

  3. Teacher Loan Forgiveness (TLF)

  4. Perkins Loan Cancellation


We've written extensively about these programs elsewhere on our site. Next, let's review Maryland specific loan repayment assistance programs.



Maryland student loan forgiveness programs


At this time, MD has seven unique programs you can pursue in the hopes of achieving some student loan assistance.



1. Maryland SmartBuy 3.0


The Maryland SmartBuy 3.0 program is a definite favorite of ours, since it offers student debt assistance and home buyer assistance all in one. If you're close to purchasing a home and have outstanding student loan debt, this program may be for you. Here's how it works:


  • You purchase a home in MD through SmartBuy 3.0

  • If you have at least $1,000 remaining in your repayment, the state will contribute up to 15% of the home's purchase price towards your loans, up to a maximum of $30,000


The only caveat to SmartBuy is that the assistance that you receive must pay off your remaining student debt balance in full. Regardless, this program is a great option for those with loans left, but have the income and savings to jump into homeownership.



SmartBuy application process


When applying to MD SmartBuy, you'll need to use an approved lender, which can be found through the maryland.gov site. The lender that you decide to work with will be able to guide you through the application, which will wipe your student loan debt and provide you with the help you need to buy purchase your house.



2. John R. Justice program in Maryland


Many states, Maryland included, have iterations of the John R. Justice program. The program is designed to offer loan repayment assistance to public defenders and prosecutors across the state who serve in qualifying roles for three years.


Managed by the Maryland Higher Education Commission, you'll need to meet the following eligibility criteria to qualify for John R. Justice:


  1. Be a United States citizen or eligible non-citizen

  2. Have qualifying federal student debt within the Stafford, Graduate PLUS, consolidation, and Perkins programs

  3. Be a fully licensed attorney qualified to practice law in MD


Qualifying job roles include prosecutors of criminal/juvenile cases at the state level, those that provide legal representation to these populations, and more.


We're familiar with the John R. Justice application, which is depicted below.



3. MD Healthcare Professional State Loan Repayment Program (SLRP)


Maryland also offers significant student loan assistance to healthcare providers willing to serve underrepresented and underserved communities across the state. The program is also partially funded by the Maryland Loan Assistance Repayment Program (MLARP), so each "side" of the program has slightly different eligibility requirements.


The main SLRP offers loan assistance to physicians and physician assistants who work in primary care or mental health at a qualifying health professional shortage area (HPSA) or within a medically underserved area (MUA).


The MLRAP expands program eligibility to last year medical residents serving in qualifying HPSAs or MUAs.


Both sides of the program require two year service commitments, and in exchange offer up to $50,000 in student loan assistance.


 

As with any other student loan forgiveness program geared towards those in the healthcare space, we recommend that you use caution before simply applying for the MD SLRP. It is an excellent program, but you may qualify for more lucrative federal forgiveness programs, especially if you work in a federally designated HPSA.


The NHSC's repayment assistance programs come to mind here, but there are others too.




4. Janet L. Hoffman Loan Assistance Repayment Program (LARP)


Maryland residents working in public service for state government, local government, or nonprofit agencies serving low-income populations may qualify for the Janet L. Hoffman program.


Eligibility is open to professions including:


  1. Lawyers

  2. Licensed clinical counselors

  3. Nurses

  4. PT/OT

  5. Social workers

  6. Speech pathologists

  7. Teachers


Generally, once you qualify, you're eligible to receive repayment assistance for a three year period according to the following schedule:

Total Student Debt

Award Limit (3 year)

Yearly Reward

>$75,001

$30,000

$10,000

$40,001 - $75,000

$18,000

$6,000

$15,001 - $40,000

$9,000

$3,000

Under $15,000

$4,500

$1,500


To retain eligibility, you'll need to resubmit your employment, lender, and tax documents annually ahead of the October 1 deadline.



5. Student Loan Debt Relief Tax Credit for Maryland Residents


Taxpayers across MD that have had a student loan balance of at least $20,000 and still hold at least $5,000 of it remaining may qualify for a substantial tax credit.


And while the program does prioritize those with high debt-to-income ratios, as well as those that have never received the credit before, there is a lot of money to go around. Since its inception in 2017, the program has awarded nearly $41 million in total tax credits.


Awards of up to $5,000 are made through the program, and all you have to do afterwards is submit proof that you used the credit towards your outstanding student loan debt. You have two years to do so.





6. Maryland Dent-Care Program


The MD Dent-Care Program (MDC-LARP) is available to dentists that actively treat underserved populations of MD residents. Designed to increase access to oral care, the MDC-LARP is open to licensed dentists across Maryland that meet the following guidelines:


  • Graduates of accredited dental schools within the United States

  • Employed full-time and provide care to MMAP recipients

  • At least 30% of patient population is MMAP

  • Currently making monthly payments on outstanding student debt


Dent-Care is a lucrative program, offering up to $23,740 per year in forgiveness, for up to three years.



7. MLARP for Foster Care Recipients


The final major Maryland based student loan forgiveness program awards loan repayment assistance to former foster care recipients across the state. The program awards recipients the lesser of 10% of your outstanding debt or $5,000, whichever is less.


Eligibility is pretty lax, as the main requirements are:


  • Being a MD resident

  • Work at least part-time for a state, county, local government

  • Former MD foster care recipient


You'll need to agree to remain employed in your qualifying role for at least one year after the terms of your award expire.


Once you receive your award, you have 120 days to provide proof to the MD Higher Education Commission that you used the funds to make a payment to your lender. Additionally, if you complete the annual employment, lender, and tax documentation paperwork, your award will automatically renew for up to three consecutive years.



Avoid student loan debt in the first place


The Old Line State also has programs for those looking to avoid taking out more debt than they may be able to handle come graduation time. Among these grant and scholarship programs worth considering are:


  1. 2+2 Transfer Scholarships

  2. Cybersecurity Public Service Scholarship Program

  3. Howard P. Rawlings Guaranteed Access (GA) Grant


The Student Debt Destroyer student loan calculator


Download our student loan calculator


If you're looking to understand how any of the major federal forgiveness programs could alter your monthly payments, then we highly recommend that you download our student loan calculator.


It will help you to understand what forgiveness plans may make sense for you, and it will also show you your:


  1. Projected debt-free date

  2. Monthly payments

  3. Forgiveness balance

  4. And more!




Don't forget to consider refinancing


You may be reading through this wondering what other options you have if none of the Maryland state or federal forgiveness options seem like feasible options to you. If this describes you, you'll likely want to consider refinancing your outstanding loans, especially if you have high interest rates and a large outstanding balance.


And depending on the interest rate environment at any given time, refinancing may actually prove more valuable than pursuing student loan forgiveness anyway.


The problem is, many Americans are unsure how to begin the refinancing process. We usually recommend starting with Splash Financial, since they are a student loan marketplace that can compare your rates across multiple different lenders at one time.


The rate check process will take less than five minutes, and it won't even impact your credit score.




Student loan forgiveness in nearby states




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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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