Debt Relief for Nurses
- Consolidation, settlement, DMPs, and bankruptcy may be options for managing unsecured debts like credit cards or personal loans.
- Nurses may be eligible for several types of student loan forgiveness.
- The costs of nursing school and the demanding nature of nursing jobs can make budgeting more of a challenge.
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Nurses help people every day. Sometimes, though, they're the ones who need a bit of help. If you're a nurse who needs help dealing with debt, you've come to a good place. You have a variety of resources for debt relief as a nurse.
As a nurse, you've probably dealt with even worse things than debt. So chances are you can get through this just fine. You just need the right information. We'll help you explore your options for debt relief, and offer tips on how to choose the right one.
Financial Challenges Nurses Commonly Face
The first step in dealing with your debt is acknowledging it, and the need to handle it. Make peace with yourself about how you got there. It may have been overspending, but it could also have been any number of things that are just part of being a working nurse in the U.S.:
Nursing school can cost $10,000 up to $100,000 or more, depending on your school and degree. Student loans are often the only way to become a nurse at all.
Traveling nurses fill crucial gaps in staffing, but they may move as often as every four weeks. This could mean taking on debt to pay for moves that aren't covered by a contract.
Irregular work schedules may make budgeting harder, or lead to gaps in pay that get covered by credit cards or loans.
Emotionally and physically demanding jobs with long hours may lead to extra costs to keep everyday life manageable.
If you’ve made mistakes, forgive yourself. It’s time to move forward with a plan to take full control of your financial future.
Debt Relief Options for Nurses
Your options for debt relief as a nurse depend on the nature of that debt. Nurses have a variety of options for student loan forgiveness, for example, but debt relief for credit cards or personal loans requires a different strategy. Here are some common options.
Public Service Loan Forgiveness (PSLF) for federal student loans
The Public Service Loan Forgiveness (PSLF) Program could help you get rid of some student loan debt if you qualify. To be eligible as a nurse, you must:
Have a Direct Loan
Be employed by a qualifying not-for-profit organization
Make at least 120 qualifying monthly payments while working full time for a qualified employer
If you meet the criteria, the PSLF Program could forgive the remainder of your Direct Loan. While the program only applies to Direct Loans, other types of federal student loans could be eligible if you consolidate your student loans using a Direct Loan.
Nurse Corps and other healthcare student loan repayment programs
The Health Resources & Services Administration (HRSA) operates the Nurse Corps, a Health Workforce Program designed to fill critical healthcare gaps. If eligible, the Nurse Corps Repayment Program could pay up to 85% of your unpaid nursing education debt.
The catch: You need to serve at least two years in a Critical Shortage Facility or an eligible school of nursing. You also need to be:
A registered nurse (RN)
An advanced practice registered nurse (ARPN)
Nurse faculty (NF)
This program is only open to nurses who went to an accredited school of nursing in a U.S. state or territory.
Your state or local area may offer their own versions of a healthcare-specific loan repayment program. Alternatively, check to see if your employer—or a prospective employer—offers any types of loan forgiveness or repayment program.
Income-driven repayment plans for federal student loans
While they won't get rid of your debt, income-driven repayment (IDR) programs could help you better keep up with your federal student loans. There are a few types of IDR programs:
Income-Based Repayment (IBR) Plan
Income-Contingent Repayment (ICR) Plan
Pay As You Earn (PAYE) Repayment Plan
The Saving on a Valuable Education (SAVE) Plan is not currently available.
Each program has unique requirements, and when you originally took out your loans can play a big role in which program works for you. Programs last at least 20 years. After you complete an IDR program, your remaining loan balances are typically forgiven.
Debt settlement for most unsecured debts
Financial hardship can hit anyone, in any profession. If you're struggling with a lot of unsecured debt—like personal loan or credit card debt—consider debt settlement.
Debt settlement means negotiating with your creditors to accept less than you owe and forgive the remainder of your debt. You may get rid of your debt for less, and it's often quicker than making minimum payments.
You can try negotiating debt settlement on your own, or you could hire a professional debt settlement company. A debt settlement company negotiates with creditors on your behalf, for a fee that they can only charge after achieving a successful outcome. Avoid companies that charge settlement fees upfront—this is illegal.
Debt consolidation loans
Juggling multiple debts adds to your mental load, and could mean things fall through the cracks. Instead, consider debt consolidation to pay off multiple debts with one new loan.
Debt consolidation can have two big benefits:
It simplifies your finances. You have one debt payment—and one due date to track—instead of many.
It could reduce your interest rate. Credit cards have particularly high interest rates, so consolidating with a personal loan sometimes means a nice rate drop.
Note that most personal loans come with origination fees, which typically cover the costs of setting up a new loan. Consider these fees when shopping for a loan.
Debt management plans
Maybe you can afford your debts, but you need some help figuring out the best way to tackle them. In this case, consider a debt management plan (DMP) from a nonprofit credit counseling agency.
Debt management plans (DMPs) are structured repayment plans that help you pay off your eligible debts in three to five years. A credit counselor helps you figure out if you qualify; if you do, they set up your DMP. Your counselor may also negotiate with your creditors for lower interest rates or to waive certain fees.
With a DMP, you make one monthly payment to the credit counselor. They then pay your creditors. The agency may charge monthly fees for the DMP, and closing your credit cards is often required.
Bankruptcy
When you're struggling with unmanageable debt, bankruptcy may be a way out. There are two main types of consumer bankruptcy:
Chapter 7. This type of bankruptcy involves liquidating your non-exempt assets to pay back debts, and forgiving the rest of your eligible debts. Chapter 7 requires a means test, so some nurses may make too much money to qualify.
Chapter 13. This type of bankruptcy restructures your debts, giving you a plan to pay off some or all of your debts in three to five years. Chapter 13 could help you save your home if you're facing foreclosure.
Consult a bankruptcy attorney if you're considering filing. Most people have better outcomes with legal assistance.
Common Types of Debt Among Nurses
Nurses carry the same types of debt as the rest of us, including:
Credit card debt
Store card debt
Personal loan debt
Student loan debt
Medical debt
Utility debt
Auto loan debt
Mortgage debt
Your debt may be secured debt, meaning it's backed by collateral or something of value that you own. Auto loans and mortgage loans are secured debts, backed by your car and home, respectively.
Debt that isn't backed by collateral is unsecured debt. Credit cards, store cards, personal loans, student loans, and medical debt are all typically unsecured debts.
How to Choose the Right Debt Relief Option
Choosing the right option for debt relief is a big part of making your plan work. When you weigh your options, ask yourself these questions:
What kind of debt do I have? Figure out which debts you need help with, since this determines your options.
How much do I owe? Total up all of your debts, noting minimum payments and interest rates.
What am I eligible for? Each option has its own requirements. Compare your qualifications with the requirements for each option to find the best fit.
What are the pros and cons? If you're eligible for multiple options, create a pro/con list for each one so you can see what you'd be getting into.
As a nurse, you know research is a big part of making good decisions. So research your options and choose with confidence.
Take the Next Step Toward Debt Relief
Nurses have a lot of options for debt relief, so consider them all carefully. Preparation is a big part of success.
If you're not sure about something, ask. Contact the program or company for more information. For example, if you're considering debt settlement, you could get a free evaluation from Freedom Debt Relief to see how it works and if it's the right fit.
Once you've chosen your debt relief strategy, it's time to execute it. Use the willpower and dedication you employ as a nurse to focus on getting your debt under control. You have the power to make it happen.
Author Information
Written by
Brittney Myers
Brittney is a personal finance expert and credit card collector who believes financial education is the key to success. Her advice on how to make smarter financial decisions has been featured by major publications and read by millions.
Reviewed by
Kimberly Rotter
Kimberly Rotter is a financial counselor and consumer credit expert who helps people with average or low incomes discover how to create wealth and opportunities. She’s a veteran writer and editor who has spent more than 30 years creating thousands of hours of educational content in every possible format.
Will debt relief affect my nursing license?
No. Debt relief doesn't affect your ability to get or maintain a nursing license.
Some employers may perform a credit check during hiring. Credit damage could affect your employment opportunities while you’re rebuilding healthy credit.
What’s the difference between debt consolidation and debt settlement?
Debt consolidation involves getting a new loan to pay off multiple debts. You pay the full amount due with your new loan, which ideally has more favorable terms. You then repay just the new loan.
Debt settlement involves settling debt for less than you owe. You could do this yourself or work with a debt relief company like Freedom Debt Relief that negotiates for you. You make a monthly payment into an account you control, then use that money to pay back your creditors if you agree to a settlement.
Can student loan debt be settled?
No. Federal student loans generally can't be settled. Private student loans may be eligible for settlement on your own or with some debt settlement professionals, though it's considered difficult to settle. Student loans usually need to be in default to be eligible for settlement.
How long does debt relief take?
The time you spend on debt relief depends on the type of debt, amount of debt, and debt relief method you choose.
Debt forgiveness: Student loan forgiveness programs can take 10 to 20 years or more.
Debt consolidation: Loans typically have terms of two to six years, though longer is sometimes possible.
Debt settlement: Your first debt could be settled within a few months, though completing a debt settlement program could take two to four years (depending on the number of debts).
Debt management plan: Most DMPs take three to five years to complete.
Bankruptcy: Chapter 7 bankruptcy could be completed within a few months; Chapter 13 bankruptcy payment plans typically take three to five years.