Many Americans are trying to juggle student loan payments with their other monthly expenses.
The median student loan balance is between $20,000 and $25,000, according to the Federal Reserve’s Report on the Economic Well-Being of U.S. Households in 2024. Naturally, borrowers are often looking for ways to shave off some of their debt, and many states offer programs that help repay at least a portion of their loan balance.
States typically create these programs to encourage workers — especially those in certain fields — to move there. It’s a trend that has been growing in recent years, says Tom O’Hare, holistic college advisor at Get College Going.
“It’s becoming a little bit more common,” says O’Hare. “I think that creative side has got to move forward to help individuals with their repayment and also to help companies with attracting and retaining key employees.” While many states offer student loan forgiveness or repayment programs, most options are only available to borrowers who work in specific high-need professions such as health care, teaching or law.
Some can be quite generous, with states paying up to $200,000 in student loans to attract high-demand medical professionals. A New York program will repay loans for in-state graduates who agree to operate a farm. Arkansas just created a program that helps pay off loans for state employees.
“Probably 90% or more of them are profession-based,” says Betsy Mayotte, president and founder of The Institute of Student Loan Advisors, a nonprofit organization that provides free student loan advice.
TISLA’s database of student loan forgiveness programs is one of the most comprehensive lists available, providing details on more than 100 federal and state repayment programs that borrowers may qualify for. Mayotte and her team update the list twice a year to keep it current.
Some of these state repayment programs only apply to federal student loans, but others will help pay off your private student loans as well. That could be increasingly important in the years ahead, as new borrowing caps on federal loans for some students are expected to push more borrowers to private loans to cover financing gaps.
We examined student loan repayment programs offered by states across the country, and highlighted four in particular that cover private student loans and are open to residents who work in a wide variety of fields.
[Read: Best Private Student Loans.]
These States Repay Student Loans, and Many Borrowers Can Qualify
Several states have repayment programs or tax credits that are available to a wide range of private student loan borrowers who live or move there. Here are four programs that don’t require you to work in health care, teaching or law.
Kansas
Open to college graduates in any field, this student loan reimbursement program has one basic requirement: You need to move to rural Kansas.
The Kansas Department of Commerce partners with 95 counties that the state has designated as Rural Opportunity Zones, and it provides various incentives for people to relocate to one of those less-populated areas. Those benefits include repaying up to $15,000 of your student loans over five years.
Before you pack up and resettle in the Sunflower State, you’ll want to check with the particular county you’re eyeing to confirm that it is participating in the program and that funds are available. A map highlighting participating counties can also be found on the Kansas Department of Commerce website. Then you’ll need to fill out an application and provide proof that you’ve established a permanent residence in the county and that you previously lived outside of it. You’ll also need to provide college transcripts and details of your student loan balance.
[Read: Best Student Loan Refinance Lenders.]
North Dakota
Graduates looking to work in one of dozens of in-demand or emerging occupations can get up to $17,000 of student loan assistance as part of the North Dakota Career Builders program.
North Dakota’s list of employment fields that qualify for student loan repayment is much more robust than most states’, and you may be surprised to find that your sales or web developer role is just as eligible for the program as medical professional positions.
Although the program is administered by the North Dakota University System, it is open to graduates of any institution outside the state as well. To qualify, you must apply within two years of being hired to work in the state. Also, like many similar programs, Career Builders matches funds from an employer or other source, so you’ll likely need to confirm that your employer is participating.
Payments are made over three years, and in any one year they can’t exceed $5,667 or one-third of your student loan balance, whichever is lower.
Maine
The Pine Tree State offers several loan repayment programs, including one for dentists that pays up to $100,000 of student loans. The state also provides a tax credit to its residents to offset student loan payments, and many Mainers are eligible for it.
The Student Loan Repayment Tax Credit of up to $2,500 per year and $25,000 lifetime is available to Maine residents with at least $13,244 of annual income. The tax credit you receive varies depending on the amount of student loans you paid during the year.
Loans obtained to earn an associate, bachelor’s or graduate degree from an accredited college, university or community college qualify for the credit.
Maryland
Similar to the benefit offered in Maine, Maryland’s Student Loan Debt Relief Tax Credit was set up to help borrowers pay off their student loans, including those from private lenders. To qualify, residents must have incurred at least $20,000 in student loan debt and must have at least a $5,000 outstanding balance remaining when they apply for the credit. You can receive up to $5,000 in credit.
Borrowers must use the credit to pay toward their student loan balance within three years of receiving it.
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These Four States Will Help Pay Your Private Student Loans originally appeared on usnews.com
