Can Social Workers Qualify for Student Loan Forgiveness?

Whether they work for the government, nonprofit agency, or private practice, all social workers qualify for student loan forgiveness for their federal student loan debt.

The U.S. Department of Education offers three main loan forgiveness programs:

1. The Public Service Loan Forgiveness Program

2. Loan Forgiveness under the Income-Driven Repayment Plans

3. The Perkins Loan Forgiveness Program

The federal government also offers loan forgiveness for both federal loans and private loans under 2 other programs:

1. National Health Service Corps Loan Repayment Program

2. Indian Health Service Loan Repayment Program

Lastly, some borrowers living in states like New York may also qualify for state-based programs to get their private student loans forgiven.

Below, you’ll find a brief overview of each program, including general eligibility requirements.

But before you go there, let me answer another question borrowers ask.

The average student loan debt for social workers with an MSW is more than $60 thousand.

Meanwhile, according to the Bureau of Labor Statistics, the median salary for social workers is around $50 thousand.

So if you owe more in student loan debt than you earn annually, how do you pay back your student loans, live on your own, buy a car, go on vacations, marry, raise a family, save for retirement, etc.

You could move in with your parents. Pick up per-diem work at another agency or private practice. Start your own supportive counseling business. Refinance your student loan debt with a private lender to get a lower interest rate. (I rarely recommend this for federal student loan borrowers because you lose PSLF and IBR benefits.)

Basically, you grind, grind, grind for a few years to pay your loans off as quickly as possible.

If you have the option to have your cost of living offset by your parents, perhaps this is the path for you.

But what if you can’t live with your parents? What do you do about your loans then?

Enter loan forgiveness options.

The PSLF program offers borrowers federal student loan forgiveness after 10 years (120 monthly payments) for borrowers who work for qualifying public service employers.

To qualify, you have to meet 5 requirements:

1. You have to have Direct Loans

2. You have to work full-time

3. You have to work full-time for the government or a non-profit organization

4. You have to make payments under a qualifying repayment plan

5. You have to make 120 monthly payments (In other words, 10 years of full-time employment isn’t enough by itself; you have to make 120 monthly payments)

Related: Can You Get Student Loan Forgiveness if You Work for a Nonprofit

A qualifying repayment plan is any of the income-driven repayment plans:

• Revised Pay As You Earn

• Pay As You Earn

• Income-Based Repayment Plan

• Income-Contingent Repayment Plan

Click here to learn more about What is Public Service Loan Forgiveness

In addition to the PSLF Program, the federal government also offers loan forgiveness after 20 to 25 years of monthly payments.

The qualifications for this program are straightforward:

Have federal student loans and make 240 to 300 qualifying monthly payments under one of the income-driven repayment plans.

The difference in the number of payments concerns whether you have federal student loan debt just from a bachelor’s degree or from a graduate degree.

Borrowers who have federal student loan debt from grad school have to make 300 payments before they qualify for loan forgiveness.

Of course, during this time, your loan balance is continuing to grow. And unlike the PSLF program, the forgiveness under an IDR plan isn’t tax-exempt.

​You’ll have to pay taxes on the loan balance that is forgiven.

Social workers may also qualify to cancel their Perkins Loans if they work for a child or family services agency in a low-income community.

The Perkins Loan program only forgives federal student loans made under the Perkins Loan Program.

Most borrowers owe only a few thousand in Perkins Loans.

As a result, Perkins Loans Cancellation doesn’t offer federal student loan borrowers much student loan forgiveness.

Still, if you have Perkins Loans, you may want to see if your balance can be canceled.

Contact the school you borrowed the loan from to find out the eligibility requirements for loan cancellation.

National Health Service Corps Loan Repayment Program

Under the NHSC Program, licensed clinical social workers can get $50 thousand to repay their student loans.

To qualify for the student loan repayment, you must agree to work two years in a community-based site in a high-need designated Health Professional Shortage Area.

FYI: The NHSC Program prioritizes LCSWs from disadvantaged backgrounds or those most likely to remain employed in a healthcare shortage area.

State-Based Loan Forgiveness Programs

• California. Social workers in California can get up to $15,000 after working for up to 24 months in an eligible setting. Eligible settings include publicly funded or public mental health facilities or areas with shortages of mental health professionals. You can receive this award up to three times.

• Michigan. Michigan offers up to $200 thousand in tax-exempt money to repay federal and private student loan debt. To be eligible, you must have a master’s degree in social work and agree to provide full-time primary healthcare services in Health Professional Shortage Areas (HPSAs) at not-for-profit health clinics for two years. Visit the Michigan Department of Health & Human Services website for more information.

• New York. New York residents can qualify for up to $26 thousand of student loan forgiveness. You’re eligible if you’re a resident of New York and are a licensed social worker with at least one year of experience in a critical human service area, such as home care or mental health. Both federal and private student loans qualify for the program. Visit the New York State Higher Education Services Corporation website for more information.