Student Loan Repayment Grants Guide

FT Contributor
Documents, a calculator, a pen, and notebooks labeled "applications" and "grants" sit on top of a table.
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A grant provides you with funding to carry out a specific task or accomplish a goal. Educational grants give funds to students who are attending college or graduate school. Students who finish college can also obtain grants to help pay off their student loans.

Why use a grant to help pay off a student loan? A student loan grant is free money. Unlike a loan, you do not have to repay it. Many student loan repayment programs offer loan forgiveness. However, to qualify for forgiveness, you usually need to make on-time payments every month for 10 to 15 years. In some cases, a grant can help you make these payments until you reach the threshold for loan forgiveness.

You need to complete an application that shows that you qualify for the grant. Funding is available in many different categories. For example, some programs focus on providing loan aid for healthcare professionals or those who work in the nonprofit sector. Other grants are for educators, public service workers, members of the military and veterans, tech workers, veterinarians, lawyers, or research scientists.

Some grants are awarded by nonprofit foundations, while private companies or professional associations provide others. State governments and the federal government also offer loan repayment grants, as do some government agencies and the military.

Where to Find Student Loan Grants

Grants are available at the state and federal level or through nonprofit organizations. Some companies offer loan repayment grants as an incentive to employees. Often, these grants are meant to provide an incentive for people who choose a particular profession. Sometimes, grant programs seek to attract more college graduates to jobs that help alleviate a staffing shortage. Other grants require that you work in an underserved area as well as in a specific profession.

You can begin your grant search by looking at your college or university. In addition to scholarships, some schools offer grants to students who enter a specific sector. For example, if you become a public defender or a lawyer for a nonprofit organization, you may qualify for loan assistance from your law school.

Next, you can search for state and federal grant programs. Government agencies and government-supported organizations administer these grants. States have similar offerings, which you can search for through state agencies or public universities associated with the state.

You can also search for grants by profession. You will find that most options related to occupations require public service. For example, there are multiple options for teachers, nurses, or military members. Professional organizations, such as the American Bar Association, offer grants and loan forgiveness programs to graduates who meet professional requirements.

Federal Loan Forgiveness and Federal Grants

Federal student loan programs offer loan forgiveness to qualifying applicants. One example of this is the Public Service Loan Forgiveness (PSLF) Program. Graduates who work full time in public service jobs can be eligible to have their student loans forgiven if they make loan payments on time for ten years (or 120 payments).

Other student loan forgiveness programs offer a similar arrangement. Most of these require that you make income-driven payments on time each month. Income-driven payments mean that the amount due depends on economic factors such as your income, living situation, family size, and other variables.

You can also seek grants and loan forgiveness options from federal agencies. For example, the National Institute of Health and the Department of Justice both offer to pay off student loans for medical researchers and lawyers, respectively.

Federal Career Grants

Career grants can be a good option for helping to pay off student loans. These grants reward you for choosing to work in a specific field.

Grants for Employees

Some companies provide grants to help employees pay off their student loans. Penguin Random House and PricewaterhouseCoopers offer such support. Typically, employees get an annual grant of $1000 to $2000 each year for a five- to 10-year period. You need to remain with the company for five to 10 years to get the maximum award.

Grants for Healthcare Professionals

You can obtain a grant or loan repayment help by working in an underserved area for some time after you graduate. The National Health Service Corps and the Nurse Corps Loan Repayment Program offer grants to nurses who work in target underserved areas or for nonprofit health providers after graduation. Doctors, likewise, can promise to work in an underserved area for three years after medical school to earn up to $120,000 in grants to pay for school.

Grants for Lawyers

Lawyers who work in specific positions after finishing law school may also qualify for grants. For example, the Department of Justice Attorney Student Loan Repayment Program provides up to $6,000 per year if a lawyer works for the DoJ for three or more years. Other grant programs, such as the John R. Justice Program, are available nationwide but administered at the state level, with details varying by state.

Grants for Research

The National Institute of Health is a federal agency that offers grants for researchers. You can obtain grants of up to $35,000 per year if you perform research in an area that the NIH considers critical.

Grants for Teachers and Education

Grant options for teachers include the Teacher Loan Forgiveness Program, which provides grants of up to $17,500 for qualified educators who teach in a low-income elementary school, middle school, or high school.

Grants for Veterinarians

The Veterinary Loan Repayment Program offers as much as $25,000 in loan support per year to qualified veterinary school graduates who agree to work in an underserved area for at least three years. Since the U.S. Department of Agriculture runs the program, work usually involves caring for agricultural animals.

Grants for Volunteers/Nonprofit

You can qualify for the Public Service Loan Forgiveness Program by working for specific charitable nonprofit organizations. You can also receive grants to cover loan payments while you volunteer for organizations such as the Peace Corps or AmeriCorps.

State- and Territory-Based Grants

It can be challenging to search for state-based grants. Most state-level educational grants are designed to provide financial aid while students are at school, not to offer assistance to pay off loans. A few states do have loan-related funding, and all states administer national loan-related grant programs. These loans usually assist people in certain professions or with specific backgrounds.

A few states have notable loan-related grants that are not available nationwide. For example, the NYS Child Welfare Worker Loan Forgiveness Incentive Program offers up to $50,000 in grants over five years to students who work in the field of child welfare. North Dakota and Maine offer incentives to STEM professionals by providing the STEM Occupations Loan Forgiveness Program and the Harold Alfond Foundation Student Loan Debt Reduction Program, respectively. To qualify, you need to be a STEM graduate who lives and works in North Dakota or Maine.

Here are some examples of nationally-available state-based grants.

  • John R. Justice Grants. These grants are for lawyers who work as state or local prosecutors, or public defenders. You apply for the program in the state in which you hold your law license. You can get up to $10,000 to help with student loans, although the terms and application requirements vary by state.
  • IHS Loan Repayment Program. The IHS Loan Repayment Program is available in states that have Native American healthcare services. You receive loan repayment assistance if you commit to work as a healthcare professional in an indigenious community in a U.S. state or territory.
  • State Loan Repayment Programs. The State Loan Repayment Program provides federal support for states to operate their own loan repayment programs. These programs provide incentives to graduates to work in Health Professional Shortage Areas (HPSAs). Most states use this funding to operate programs that award healthcare providers for working for several years in an HPSA. These programs have different names in different states, but they all require several years of employment in an underserved area.
  • Teacher Loan Repayment Grants. Most states also operate teacher loan repayment grant programs for teachers who work in underserved and low-income areas. Some states provide grants, while others have loan forgiveness programs for teachers who work in an area of need. A number of grant options at the state level are associated with federal programs.

Grants can help you pay off your student loans. The amount of financial support that you can get depends on the profession that you choose and where you choose to work. If you understand how they work, you can use grants to help pay off your student loans early.

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