If you’re looking for a career with long-term staying power, the fast-growing nursing industry could be a great choice. After all, people will always need nursing care, and as the sizable baby boom population ages, this need will become increasingly critical.
Of course, you must go to school to become a registered nurse. Depending on your level of education when you enter, a nursing program might take from approximately two to four years. For many students, this also means taking out student loans for nursing school.
Here are the key options you should know about when it comes to nursing student loans:
- Federal subsidized and unsubsidized student loans
- Federal PLUS loans
- Health Resources and Services Administration loans
- Private student loans for nursing school
- Plus: How to reduce your need for student loan debt
Federal subsidized and unsubsidized student loans for nursing school
Student loans for nursing school are available on a federal level. You should begin by filling out the Free Application for Federal Student Aid (FAFSA) to qualify.
Most students will qualify for direct unsubsidized loans. But if you can prove financial need, you might qualify for a direct subsidized loan.
The biggest difference between these two types of loans is who pays the interest. With unsubsidized debt, you’re responsible for paying all the interest charges. On a federally subsidized loan, the government will pay the interest that accrues during specific periods, including while you’re enrolled.
The government offers eligible first-year dependent undergraduate students up to a combined $5,500 in subsidized and unsubsidized student loans. You can borrow up to $6,500 during your second year and $7,500 during your third year and beyond. Independent students and graduate students have higher borrowing limits. However, grad students are only eligible for unsubsidized loans.
To qualify, you don’t have to worry about meeting credit requirements or having an income. Plus, you don’t need to start repaying the loan until after you graduate.
|● Almost anyone can get unsubsidized federal student loans.
● Interest rates are set by the government and offered to all borrowers.
● You can put off repayment until you graduate.
● These loans are eligible for income-driven repayment (IDR) and federal loan forgiveness.
● If you qualify for subsidized student loans, the government pays your interest while you’re in school.
|● Interest on unsubsidized loans begins accruing immediately.
● You have limits on how much you can borrow.
● Students with excellent credit might find better interest rates elsewhere.
Federal PLUS Loans for Nursing school
There are two types of federal PLUS loans that might be useful as nursing school loans: parent PLUS loans and grad PLUS loans.
A parent PLUS loan allows parents to help pay for their dependent student’s undergraduate career. With this type of loan, they can borrow up to the school’s cost of attendance, minus other financial aid received.
Meanwhile, you can take out a grad PLUS loan to help pay for your advanced degree.
Unfortunately, interest rates for PLUS loans are typically higher than rates for direct subsidized and unsubsidized loans.
|Interest rates for federal loans for the 2020-2021 school year|
|Direct PLUS loans||5.30%|
|Direct unsubsidized loans (for graduate students)||4.30%|
|Direct loans (for undergraduates)||2.75%|
Borrowers won’t qualify for these loans if they have an adverse credit history. That definition includes default, bankruptcy, tax lien, wage garnishment, foreclosure, and repossession over the past five years.
|● Either loan can help you cover a gap in funding.
● A parent can help their undergraduate student pay for school.
|● The interest rate is higher than for many other student loans.
● Borrowers must meet credit requirements.
Health Resources and Services Administration (HRSA) loans for nursing school
HRSA student loans are aimed at helping students in health professions, including nursing.
These student loans for nursing school are low-interest and available to full-time disadvantaged students. These loans aren’t offered by the government directly. Instead, schools participate in the program to offer loans.
These loans are given out on a first-come, first-served basis and until funding runs out for the year.
|● Low-income and other disadvantaged students can get additional funding for nursing school.
● You don’t need to meet credit criteria.
|● The program has limited funds.
● HRSA student loans aren’t available at all nursing schools, including private institutions.
Private student loans for nursing school
It’s also possible to pay for your nursing degree using private student loans. Many private education lenders are willing to fund your expenses.
Each private lender sets its own credit and income qualifications that borrowers must meet. Additionally, you might have to start repaying the loan immediately, rather than wait until you finish your nursing degree. However, you can find private lenders that offer a grace period and allow you to postpone payments until after graduation.
|Some top lenders for student loans for nursing school|
|Sallie Mae||Good fit for speedy cosigner release|
|SoFi||Good fit for unemployment protection during repayment|
|Earnest||Good fit for comprehensive approval process|
|Ascent||Good fit for loans without a cosigner|
If you don’t meet the criteria for a private student loan on your own, consider applying with a cosigner. With a qualified cosigner, you can get the loan you need to fund your education.
On top of that, you might also get an interest rate lower than current federal rates. Some lenders even offer variable rates on their loans and provide other perks, such as hardship programs and rate discounts for autopay.
|● You might qualify for rates that are lower than those on federal student loans.
● You could borrow more than what’s allowed with certain federal loans.
● Some lenders offer special repayment programs.
● You don’t need to qualify for federal aid to apply.
|● Excellent credit and a healthy income are required for the best rates.
● These loans don’t qualify for IDR plans or federal loan forgiveness programs.
● Variable rates can increase over time.
● You might have to begin repayment while still in school.
Reduce your need for student loans for nursing school
Student loans for nursing school are a useful way to fund your degree but don’t take on more debt than you can handle. Look for ways to reduce your need for student loans by working during school, searching for scholarships and grants for nursing school, and attending an affordable program. You can also consider state-based programs, such as the Georgia Student Access Loan promoted by Emory University’s top-rated nursing school.
If you already have a job in the healthcare field, you also may be able to get tuition reimbursement from your employer. For programs like nursing, you can also look for multiple loan forgiveness programs, particularly if you are willing to work in an area that has a critical shortage of nurses.
For example, HRSA offers a Nurse Corps program for those willing to make a commitment of two years of service at a critical needs facility. This program offers a scholarship or loan repayment in exchange for such a service.
Here is our complete guide to student loan forgiveness programs for nurses.