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Attending medical school can be an extremely rewarding path, it can also be an expensive one. Luckily, there are some great medical school scholarships that can help ease the financial burden of attending medical school. Students thinking about attending medical school, or who are currently enrolled, may want to consider looking into scholarships for medical school.

There are plenty of scholarships for medical students and more general scholarships that they can apply for to help pay for college. Keep reading for a roundup of the best medical student scholarships, how to apply for them, and how much they’re worth.

Related: Finding & Applying to Scholarships for Grad School

Brown Medical and Educational Society Healthcare Scholarship

Dollar amount: Unknown

Application process: To apply for the Brown Medical and Educational Society Healthcare Scholarship , students must complete an application, submit an official college or university transcript in a sealed envelope, and submit three letters of recommendation.

Eligibility: To qualify for this scholarship, students must be an undergraduate or graduate student pursuing a degree at a US based four-year university while studying a healthcare degree such as nursing, dentistry, medicine, and allied health. Recipients must also identify as a member of select ethnic groups and must be U.S. citizens.

Chinese American Physicians Society Scholarships

Dollar amount: $3,000 to $5,000

Application process: The application for the 2021-2022 school year is set to open in December 2021. Applicants can expect to submit essays as a part of the application.

Eligibility: To receive a Chinese American Physicians Society Scholarship , applicants must be a student at a US based medical school and applicants are judged on their financial needs, academic achievements, essays, and community service records.

Dolores Zohrab Liebmann Fund

Dollar amount: Unknown

Applicant process: The Dolores Zohrab Liebmann Fund requires students submit their application through the dean of the university at the school they are attending for graduate studies. Students can connect with their school’s fellowship or financial aid office to learn more about what the application process looks like for students at their school. Only select schools participate in this program.

Eligibility: Students must be US citizens and attend a US based accredited and designated higher education institution as a graduate student. National descent is not taken into consideration and students are not limited to pursuing Armenian studies.

The Hispanic Health Professional Student Scholarship

Dollar amount: NHHF has awarded $1,555,000 to 306 awardees as of January 2021.

Application process: Applicants must submit the following supporting documents as a part of their application for the The Hispanic Health Professional Student Scholarship :

• Personal statement or essay that is double-spaced and a maximum of two pages outlining their career goals

• Curriculum vitae that shares up to date employment experience, education history, extracurricular activities, and awards

• One letter of recommendation

• Proof of their US citizenship DACA status, or residency

• Unofficial copy of their school transcripts

Eligibility: To be eligible for this scholarship opportunity, students must have a 3.0 GPA and be currently enrolled full time in a US graduate program studying one of the following subjects:

• Medicine (allopathic or osteopathic)

• Dentistry

• Pharmacy

• Nursing (including BSN)

• Public Health or Public Policy

• Physician Associate

Joseph Collins Scholarship

Dollar amount: $10,000

Application process: Applicants for the Joseph Collins Scholarship must demonstrate an interest in the arts and letters or another type of cultural pursuit that falls outside of the field of medicine and needs to show an intent to specialize in psychiatry, neurourology, or become a general practitioner.

Eligibility: The moral character of the applicant and their scholastic record will be taken into account. Students who are attending medical schools east of the Mississippi river and are ranked in the top 50% of their class are eligible to apply.

The National Health Service Corps Scholarship Program

Dollar amount: Full year of scholarship support up to four years.

Application process: To apply for the National Health Service Corps Scholarship Program , applicants must pass an eligibility screening, submit general information about themselves, their degree, and their backgrounds, as well as providing two letters of recommendation.

In return, recipients of this scholarship will work in primary care in Health Professional Shortage Areas (HPSAs). The time commitment may vary based on how much aid the student received.

Eligibility: To be eligible for this scholarship, applicants have to be either a US citizen or a US national and be able to submit proof of their status. Applicants must also be enrolled as full-time students and attend an accredited school or academic program in the US or in a US territory.

MPOWER Global Citizenship Scholarship

Dollar amount: $1,000 to $5,000

Application process: To apply for this scholarship program, applicants must complete the application form provided by MPOWER.

Eligibility: Recipients of the MPOWER Global Citizenship Scholarship must be international students that are legally allowed to work and attend school in either the US or Canada. They must also be enrolled in a US or Canadian school that MPOWER supports .

Paul & Daisy Soros Fellowships for New Americans

Dollar amount: Up to $90,000 in financial support over two years.

Application process: In order to apply for the Paul & Daisy Soros Fellowships for New Americans , students must submit the following information and materials in an online application.

• Personal and contact information

• Higher-education history

• Information about the graduate program they are seeking support for

• Three to five recommendations

• Resume

• Two essays

• College and graduate school transcripts

• Standardized test scores

• Optional exhibits

Eligibility: Applicants must be aged 30 or younger by the time of the application deadline and need to plan on either starting or continuing a full-time graduate degree program in the US.

Students may apply before they begin graduate school or while they are enrolled. Applicants must also meet the scholarship’s definition of “new American,” which is an individual whose birth parents were born outside of the US as non-US citizens.

Pisacano Scholars Leadership Program

Dollar amount: $7,000 per year up to four years.

Application process: Applications can be mailed or emailed and must included the following information:

• Official copy of undergraduate and graduate school transcript if applicable

• Official copy of medical school transcript

• Copy of MCAT scores

• Copy of USMLE score or COMLEX score

• Copy of current CV

• Essay

Eligibility: In order to qualify for the Pisacano Scholars Leadership Program , applicants must be third-year medical students who have demonstrated a strong commitment to the specialty of family medicine.

Leadership skills, academic achievements, communication skills, identifiable character and integrity, and community service involvement will all be taken into consideration.

How Student Loan Refinancing Can Help

Those who already have medical school debt and may no longer be eligible for medical school scholarships may want to consider refinancing their existing student loans. Under the right terms, refinancing student loans can save money and help them pay down their debt faster. Refinancing student loans involves consolidating student loans through a private lender into a new loan that ideally comes with a better rate and term.

The student loan refinancing process varies by lender, but generally, the borrower ends up with a new loan, which can be easier to manage than multiple loans.

While some lenders only refinance private student loans, SoFi refinances both private and federal student loans. If the applicant can secure a better interest rate, they may end up paying less over the life of their loan.

When a borrower applies to refinance their loan or loans, the lender will generally take their credit score, credit history, and other key financial information into consideration to determine their rates and terms.

It’s worth noting that refinancing federal student loans into private ones causes the borrower to lose out on federal protections. Private lenders may not offer forbearance, deferment, and hardship programs.

Recommended: Private vs. Federal Student Loans

The Takeaway

Scholarships can be an effective way to help medical students pay for med school.

Application processes and eligibility requirements will vary from scholarship to scholarship so it may be helpful to browse around for different scholarships that fit your unique educational and personal profile.

Learn more about SoFi student loan refinancing.

Photo credit: iStock/JohnnyGreig

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SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Student Loan Refinancing
If you are a federal student loan borrower you should take time now to prepare for your payments to restart, including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. (You may pay more interest over the life of the loan if you refinance with an extended term.) Please note that once you refinance federal student loans, you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income-based repayment plans, such as the SAVE Plan, or extended repayment plans.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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The costs of medical school are rising at an alarming rate. According to US News, in the past decade, the cost of attending medical school has risen 3% to 4% annually.

Thirty-five years ago, medical students graduated with an average of $32,000 in student loan debt . In 2019, the median medical school debt for graduates was $200,000 , according to the Association of American Medical Colleges (AAMC) with 73% of students graduating with debt.

The rising cost of medical school, plus the daunting number of years of education and training is making some prospective medical students ask: Is an MD really worth it? That’s ultimately up to you.

But it’s worth noting that while medical school has traditionally been a path to a lucrative career, the steep up-front costs might be starting to make the endgame look less appealing.

This can be particularly true for would-be doctors interested in working in relatively low-paying fields like general practice (as compared to say anesthesiology).

While it might be relatively easy to pay down student loan debt for those entering a higher-paying specialty like orthopedics or anesthesiology, a doctor going into general practice might take years (even decades!) to pay off their private student loans.

To gain a better understanding of how much medical school actually costs, we’ll take a look at the costs of an MD, and some ways young doctors can get out of medical school debt faster after graduation.

Recommended: 6 Strategies to Pay off Student Loans Quickly

How Much Does Medical School Cost?

The average medical school tuition varies depending on factors like on whether the student is attending a public or private university.

The average annual cost of in-state tuition, fees, and health insurance for the first year of medical school for a student at a public university was about $41,438 in the 2020 to 2021 academic year. At a private school, the average annual cost was about $61,490.

But that’s only the cost of tuition, fees, and insurance—there’s also living costs to consider which is why it’s also useful to consider the entire cost of attendance (COA).

Each school publishes the estimated costs of attendance for their program, which typically not only include tuition and fees, but also costs like room and board, textbooks and supplies, and travel.

The AAMC calculated that the median cost of attendance for four years of medical school amounted to around $250,222 for public medical schools and $330,180 for private medical schools. But these costs can vary a lot depending on whether you’re attending school in Kansas City or San Francisco.

Why Is Medical School More Expensive Than Ever?

The rising cost of medical school tuition is part of a larger trend. It is estimated that the cost of college tuition and fees at private nonprofit four-year institutions in America grew at a rate of just over 2% from the 2019-2020 to 2020-2021 school years.

So what is driving the price increase? In general, college tuition has increased dramatically in the past 30 years or so, while wages have grown at a much slower rate. But what’s behind the dramatic uptick in college prices? The potential answer is two-fold. One factor is the demand for a college education has also dramatically risen over the last three decades.

Another factor more pertinent to public universities: a decline in state funding. It’s been observed in multiple states that as the education budget gets stripped, tuition costs paid by students also rises. And while lawmakers likely understand such a correlation exists, as long as federal financial aid is so freely available for students, there is likely little incentive to digress from such cuts.

How Long Does Paying for Med School Take?

So why do med students often go into so much debt?

It’s partly because the grueling requirements of their programs don’t often allow for part-time work. As a result, many students apply for financial aid to cover their college price tag, which means they graduate with significant amounts of student loan debt.

So how long does it take to pay back the debt? A lot of this depends on the student and the career path they take and the payments they make. However, the relatively low salaries young doctors earn during their residencies don’t typically allow for much opportunity to pay back loans until their first position after residency.

Related: Smart Medical School Loan Repayment Strategies

Let’s say, hypothetically, a borrower has federal Direct Loans, such as Stafford, PLUS, or a Direct Consolidation Loan. And let’s also say you can prove you have partial financial hardship (PFH), and qualify for an income-driven repayment plan.

In that situation, the monthly repayment would be capped at 10% to 15% of the borrower’s monthly discretionary income, for a period of up to 25 years. And, after 25 years, whatever hasn’t been repaid is forgiven (although that amount may be taxable).

However, if after residency, the borrower in question gets a position with an income that removes them from the PFH tier, they could switch to the Standard Repayment Plan for federal student loans, and potentially pay off the loan more quickly.

Is It Possible to Shorten the Medical Debt Payment Timeline?

Here are some tips for those interested and able to shorten their repayment timeline, which can lower the amount of student loan interest paid over the life of the loan.

Repaying Loans During Residency

It is possible to start paying down medical school debt in residency. While some students may be tempted to put their loans in student loan forbearance in their residency years, doing so can add quite a bit in compounding interest to the bill.

Instead, consider an income-driven repayment plan to start paying back federal loans with an affordable payment. Another option is to look into SoFi’s medical residency refinance options to compare.

Making Extra Payments

Another tactic to help pay off student loans faster is via simple budgeting. After getting your first position post-residency, consider committing to living on a relatively tight budget for just a few more years. Putting as much salary toward extra student loan payments as possible, could potentially help cut time—and interest payments—off the repayment timeline.

Speeding Up Med School Debt Repayment With Refinancing Student Loans

Depending on a borrower’s personal financial profile and credit score, among other factors, it may be possible to secure a lower interest rate or a lower required monthly payment, depending on the terms you choose if you refinance your student loan.

A lower monthly payment could help improve cash flow in the present or a lower interest could help reduce how much money is paid over the life of the loan. Keep in mind that lowering a monthly payment through refinancing generally is the result of extending the loan term, which can make the loan more expensive in the long run.

While refinancing could help borrowers save money over the life of the loan, it does mean giving up the benefits that come with federal student loans like income-driven repayment, deferment, forbearance, and student loan forgiveness specific to physicians.

But for borrowers who don’t foresee needing these services, refinancing might be a viable option.

Recommended: Guide to Refinancing Medical School Loans

The Takeaway

The cost of medical school has risen in the past 30 years, and so has the amount of debt med students take on to pursue a career as an MD. But a career in the medical field can potentially be both lucrative and rewarding, so for some, medical school can be worth the time, effort, and cost.

Borrowers who are repaying student loans from medical school may consider strategies like income-driven repayment plans, making overpayments, or student loan refinancing to help them tackle their student loan debt.

Wondering how much you could lower your monthly payments by refinancing your student loans? Check out SoFi and see your rate in minutes.

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Student Loan Refinancing
If you are a federal student loan borrower you should take time now to prepare for your payments to restart, including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. (You may pay more interest over the life of the loan if you refinance with an extended term.) Please note that once you refinance federal student loans, you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income-based repayment plans, such as the SAVE Plan, or extended repayment plans.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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It’s no secret, the MCAT is notoriously difficult. Thankfully, by learning how to study for the MCATs, medical school hopefuls may be able to improve their scores come testing day, which could bring them one step closer to fulfilling their dreams.

Here are a few ways in which prospective medical school students can study for the MCATs and go the distance with their goals.

What Are the MCATs?

MCAT stands for Medical College Admission Test® (MCAT®) . The test, which the Association of American Medical Colleges (AAMC) creates and administers every year, is multiple-choice and standardized. Medical schools have been utilizing it for more than 90 years to determine which students should gain admission.

Most medical schools in the United States and some in Canada will require that students take the MCATs. Every year, more than 85,000 prospective medical school students take it.

There are four sections to the MCATs, including critical analysis and reasoning skills, biological and biochemical functions of living systems, chemical and physical foundations of biological systems, and psychological, social, and biological foundations of behavior.

Students will receive five scores: one for each section, and then one total score. In each section, they can get a score ranging from 118 to 132, and the total score ranges from 472 to 528. Generally, a competitive MCAT score is a total of 509 or above, which would place a student in the 80th percentile.

The average MCAT score for all medical school applicants is between a 500 and 508. Usually, students will receive scores 30 to 35 days after they take the exam.

Keep in mind that MCAT scores, while important, are just one part of a medical school application. Medical schools often review other factors, including things like a student’s:

•  GPA
•  Undergraduate coursework
•  Experience related to the medical field, including research and volunteer work
•  Letters of recommendation
•  Extracurricular activities
•  Personal statement

If a student has a high GPA from a competitive undergraduate school, for instance, and they don’t score very high on the MCATs, they may still have a chance of getting into a medical school.

Getting a competitive score on the MCAT can give applicants an edge, especially when applying to ultra-competitive medical schools. One way students can help improve their chances of getting a desirable score on the MCAT is to learn how to study for the unique demands of the test.

Studying for the MCAT

One of the first things a student can do when determining how to study for the MCAT is to create a study plan. A well-crafted study plan will review what materials the student should review in order to prepare for the exam.

The AAMC Website

One jumping off point – review the material covered on the MCAT. The AAMC provides an in-depth outline on their website . Obviously, the same questions students will see on the actual exam won’t be listed, but sample questions that are similar to the real questions are.

The website allows students to download the entire exam content in a PDF and watch tutorial videos. For instance, according to the AAMC’s guide , the Biological and Biochemical Foundations of Living Systems section of the MCAT “tests processes that are unique to living organisms, such as growing and reproducing, maintaining a constant internal environment, acquiring materials and energy, sensing and responding to environmental changes, and adapting.”

The section has 59 questions, and students get 95 minutes to complete them.

Online Resources

There are a variety of other online resources students can explore to help them review. For example, the AAMC currently recommends students take a look at Khan Academy’s MCAT Video Collection , where there are more than 900 videos and 3,000 questions that students can use to review. This content will be available for students to access until September 2021.

There are also MCAT study apps like MCAT Prep from Varsity Tutors LLC and MCAT Prep by Magoosh that students can download and use to study.

Books, Textbooks, and Class Resources

It may also help to buy or borrow books from the library that go into detail on the MCAT. Students should just make sure that the books they’re reading are up to date.

It can also be helpful to review class notes and study guides from courses you’ve taken that are related to MCAT materials. Some schools have study groups and other academic support resources for students who are studying for the MCAT. If you’re currently enrolled in classes, take a look to see what might be offered at your campus.

Practice Tests

AAMC offers official sample MCAT practice exams online , and they cost $35 each. Taking practice tests can help students familiarize themselves with the exam. Taking practice tests can also be important in helping students understand the timing of each section.

Study Groups and Tutors

Getting an MCAT tutor who has taken the test could also be helpful. A tutor will generally be able to provide guidance on what kind of questions a student can expect and effective methods and tips for studying. Additionally, a tutor could help a student stay motivated and hold them accountable.

Students can find tutors by asking friends and family members who have taken the MCATs recently for recommendations. There are also test preparation companies that provide resources for students to find tutors online or in person.

A search on an independent website like Google or Yelp can help students be sure that the test prep company they are looking into is legitimate.

Study groups can also be a tool to help students who are preparing for the MCAT. Students can find others who are on the same trajectory and plan to take the test and go to medical school around the same time as them. If possible, find a group where each student has a different strength and weakness, this way each student can learn from one another.

It may help to use a shared calendar or another tool to make sure everyone is on the same page for dates, times, and locations for when the study group will meet. Students can find MCAT study groups by looking on Google and/or signing up for virtual groups on Facebook.

Important Dates to Keep in Mind

Students can take the MCATs several times throughout the year, from late January through September. There are hundreds of test locations around the U.S. and Canada as well as select locations around the globe.

If a student’s preferred MCAT test date or location is not available, they can sign up for email notifications to see if it becomes available down the line.

If students are ready to take the test in 2021, they can see the full schedule of testing dates on the AAMC’s website. In light of the COVID-19 pandemic, the AAMC has released protocols for in-person testing in the coming year. While they currently plan to offer in-person testing, they acknowledge that this may change. Learn more about the AAMC’s approach here .

Paying for the MCATs and Medical School

The registration fee for the MCAT exam is $320, and that includes distribution of scores. There may be additional fees for changes to a registration, a late registration, and for taking the test at international sites.

The AAMC does offer a Fee Assistance Program to students who are struggling to pay for the test and/or medical school applications. To be eligible for the Fee Assistance Program, students must meet the following eligibility requirements:

•   Be a US Citizen or Lawful Permanent Resident of the US.
•   Must have a total family income that is 400% or less than the 2019 national poverty level for their family size.

Note that the Fee Assistance Program will review financial information of the student and the student’s parents, even if the student is considered independent.

Keep in mind that along with the MCAT fee, applying to medical school can be quite expensive. Most medical schools in the US utilize the AAMC’s American Medical College Application Service® (AMCAS®). To apply to schools in 2021, students will generally pay a first-time application fee of $170, as well as $41 for each additional school.

Some medical schools may require a secondary application, and those fees range depending on the school. Students may also need additional money to travel to and tour schools.

The application process is just one portion of the cost of med school. After being accepted, there’s the cost of tuition, books, and more. The average cost of the first year of medical school at a public school with in-state tuition is $37,556, which includes tuition, fees, and health insurance.

The average cost for the first-year at a private medical school is $60,665. According to the AAMC, the median debt for medical school graduates is $200,000.

Paying for School with the Help of SoFi

Paying for the MCATs and medical school can be a challenge. SoFi understands this, which is why they offer students no-fee private student loans and the opportunity to refinance their current student loans.

Note that refinancing federal student loans eliminates them from any borrower protections like Public Service Loan Forgiveness, income-driven repayment, and deferment options, so it may not be the right choice for everyone.

Applications for a private student loan or refinancing loan with SoFi can be completed entirely online. SoFi members gain access to career coaching, special events, and more.

Worried about the cost of medical school? Learn more about options available with SoFi, like private student loans to help pay for medical school or refinancing existing student loans—either of which could help you make your med school dreams a reality.

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SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

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Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs. SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.

Student Loan Refinancing
If you are a federal student loan borrower you should take time now to prepare for your payments to restart, including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. (You may pay more interest over the life of the loan if you refinance with an extended term.) Please note that once you refinance federal student loans, you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income-based repayment plans, such as the SAVE Plan, or extended repayment plans.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Editor's Note: For the latest developments regarding federal student loan debt repayment, check out our student debt guide.

With Americans facing over $1.6 trillion in combined student loan balances, many borrowers are on the hunt for ways to ease their debt burden. One option you may have seen was called the Obama Student Loan Forgiveness Plan, which according to some websites, was a way for some borrowers to escape their debt for a small fee.

This offer might sound appealing, but there’s one problem: It’s fake. It’s just one example of real ads that scammers have used to target and bilk borrowers.

Fraudsters have used lines like this to lure in their marks, then charged them hefty fees to fill out forms they could’ve filled out themselves for free. In the worst cases, people end up paying for nonexistent services.

Here are some answers to your burning questions on student loan forgiveness, so you can get a better idea of how the program works:

Does Any Student Loan Forgiveness Act Exist?

Yes. The Student Loan Forgiveness Act (SLFA) was a congressional bill introduced in 2012 intended to help borrowers with paying down their student debt.

In addition to capping interest rates for all federal loans, the proposed law would have introduced a repayment plan that allows borrowers to have their loans forgiven after 10 years if they made monthly payments equivalent to 10% of their adjusted gross income. The bill also would have made borrowers in public service jobs eligible for loan forgiveness after five years, instead of 10.

Sound too good to be true? It was. The bill never made it out of committee.

So, What is Obama’s New Student Loan Forgiveness Program?

Even though you may have heard about it, “Obama’s new student loan forgiveness program” doesn’t exist. During his tenure, President Obama did expand the reach of federal loan forgiveness programs. A bill he signed in 2010 allowed students who took out certain federal loans to have their balances forgiven in 20 years, rather than 25.

The same bill capped annual payments at 10% of adjusted gross income, rather than 15%. It also ushered in loan forgiveness after 10 years for borrowers working in qualified public service jobs.

Those changes preceded the introduction of the Student Loan Forgiveness Act (SLFA), and was never officially called “Obama’s Student Loan Forgiveness Program.” Likewise, there is no “new” student loan forgiveness program in Obama’s name, either, obviously.

Then Why Have I Read About Obama’s New Student Loan Forgiveness Program?

Because it’s a term that debt relief companies use to confuse student loan borrowers. The name seems convincing since President Obama did take action on federal student loans and legitimate federal loan forgiveness programs exist. That’s why some borrowers have been duped into paying high fees for pointless—or nonexistent—services. Don’t be fooled: The program isn’t real!

Debt relief companies advertising the “Student Loan Forgiveness Act” or “Obama’s New Student Loan Forgiveness Program” are bad news. Understanding which programs are real and which are fake can help you avoid being scammed—and find legitimate ways to actually have some of your student loans forgiven.

What Are Some Legitimate Options for Student Loan Forgiveness?

No, Obama’s Student Loan Forgiveness Act never passed. However, there are several real options for having federal student loans forgiven.

In fact, in response to the coronavirus epidemic, the CARES Act suspended federal student loan interest and payment suspension through September 2020. (Update: The pause on federal student loan repayment has been extended through Dec. 31, 2022)

The pending HEROES Act (narrowly passed by the House in mid-May, 2020) proposed $10,000 each of federal student loan AND private student loans forgiveness initially but may have more stringent eligibility requirements if passed by the Senate. While it’s definitely something to keep an eye on, here are some existing programs that may be helpful.

Income-Driven Repayment Plans

The government currently offers four income-driven repayment plans for federal student loans that can forgive borrowers’ balances after 20 or 25 years.

There are eligibility requirements, like making required monthly payments for a designated period of time, which are tied to a person’s income. The plans a borrower qualifies for will depend on the types of loans they have and when they took them out.

These student loan repayment plans are based on borrowers’ discretionary income, or the amount they earn after subtracting necessary expenses like taxes, shelter, and food. Here is a brief overview of each one:

•   Revised Pay As You Earn Repayment Plan (REPAYE): Borrowers’ monthly payment is typically 10% of their income. If all loans were taken out for undergraduate studies, they’ll make payments for 20 years; if they also took out loans for graduate or professional studies, they’ll make payments for 25 years. At the end of 20 or 25 years, the remaining amount will be forgiven.
•   Pay As You Earn Repayment Plan (PAYE): People pay up to 10% of their discretionary income each month, but they never pay more than they would under the 10-year Standard Repayment Plan. After 20 years, the remaining debt will be forgiven.
•   Income-Based Repayment Plan (IBR): People will pay 10% of their discretionary income for 20 years if they became a new borrower on or after July 1, 2014, and 15% for 25 years if they were a borrower before July 1, 2014. They will never pay more than they would under the 10-year Standard Repayment Plan. Borrowers’ debt will be forgiven after either 20 or 25 years.
•   Income-Contingent Repayment Plan (ICR): Borrowers choose whichever repayment plan is cheaper—20% of their discretionary income or what they would pay if they spread their payments out equally over 12 years. Any remaining balance will be forgiven after 25 years.

These four plans are designed to help borrowers make monthly payments they can actually afford. Some people may assume that an income-driven repayment plan that results in forgiveness is best for them, when in reality, this might not be the case.

Note that if the remaining balance of your loan is forgiven, you may be responsible for paying income taxes on that amount.

A repayment calculator can be a useful tool to help determine enrolling in an income-based forgiveness program that would be beneficial. After a borrower plugs in their information, they could discover that they would pay less, in the long run, should they enroll in, say, the government’s Standard Repayment Plan.

Public Service Loan Forgiveness

Borrowers can have their loans forgiven in 10 years under the Public Service Loan Forgiveness (PSLF) program. To potentially qualify, they must work full-time for a qualified government organization, nonprofit, or certain public-interest employers, such as a public interest law firm, public library, or public health provider.

Over those 10 years, borrowers must make 120 qualifying monthly payments, and the payment amount is based on their income. Those 120 payments don’t necessarily have to be consecutive. For example, let’s say a borrower works for the local government for three years, then switches to the private sector for a year.

If they decide to go back into public service after that year, they can pick up where they left off with payments rather than start all over.

The PSLF program can be difficult to qualify for, but some people have successfully enrolled. As of March 2020, 145,758 borrowers had applied for the program. Only 3,174 applications were accepted. 171,321 applications had been rejected, and the remaining applications were still processing.

Teacher Loan Forgiveness Program

Qualifying teachers can also get up to $17,500 of their federal loans forgiven after five years teaching full-time under the Teacher Loan Forgiveness Program. The American Federation of Teachers has a searchable database of state and local loan forgiveness programs.

To qualify for the full amount, teachers must either teach math or science at the secondary level, or teach special education at the elementary or secondary level. Otherwise, borrowers can have up to $5,000 forgiven if they are a full-time teacher at the elementary or secondary level.

NURSE Corps Loan Repayment Program

Health professionals have access to other loan assistance programs. The federal government’s NURSE Corps Loan Repayment Program pays up to 85% of eligible nurses’ unpaid debt for nursing school.

To receive loan forgiveness, borrowers must serve for two years in a Critical Shortage Facility or work as nurse faculty in an accredited school of nursing.

After two years, 60% of their nursing loans will be forgiven. If a borrower applies and is accepted for a third year, an additional 25% of their original loan amount will be forgiven, coming to a total of 85%.

Borrowers interested in the NURSE Corps Loan Repayment Program can read about what qualifies as a Critical Shortage Facility or an eligible school of nursing before applying.

Indian Health Services’ Loan Repayment Program

The Indian Health Services’ Loan Repayment Program will repay up to $40,000 in qualifying loans for doctors, nurses, psychologists, dentists, and other professionals who spend two years working in health facilities serving American Indian or Alaska Native communities.

Once a borrower completes their initial two years, they may choose to extend their contract each year until their student loans are completely forgiven.

In 2019, the Indian Health Service’s budget allows for up to 384 new awards for two-year contracts, and around 392 awards for one-year contract extensions. The average award for a one-year extension is $24,840 in 2019.

Even those who aren’t typical medical professionals, like doctors or nurses, may still qualify. The IHS has also provided awards to people in other fields, such as social work, dietetics, and environmental engineering.

The National Health Service Corps

The National Health Service Corps offers up to $50,000 for loan repayment to medical, dental, and mental health practitioners who spend two years working in underserved areas.

Loan forgiveness programs are generally available for federal loans, as opposed to private ones. In rare cases, such as school closure while a student is enrolled or soon after, they could qualify to have their loan discharged or canceled.

Health Professional Shortage Areas (HPSAs) include facilities such as correctional facilities, state mental hospitals, federally qualified health centers, and Indian health facilities, just to name a few. Each HPSA receives a score depending on how great the site’s need is.

Scores range from 0 to 25 for primary care and mental health, and 0 to 26 for dental care. The higher the score, the greater the need.

Borrowers have the option to enroll in either a full-time or part-time position, but people working in private practice must work full-time. Full-time health professionals may receive awards up to $50,000 if they work at a site with a score of at least 14, and up to $30,000 if the site’s score is 13 or below. Half-time employees will receive up to $25,000 if their site’s score is at least 14, and up to $15,000 if the score is 13 or lower.

Interested in learning more about your options for student loan repayment? Check out SoFi’s student loan help center to get the answers you need about your student debt. The help center explains student loan jargon in terms people can understand, provides loan calculators, and even offers student loan refinancing to hopefully land borrowers lower rates.

Refinancing student loans through a private lender can disqualify people from enrolling in federal loan forgiveness programs and loan forgiveness programs, and disqualifies them from CARES Act forbearance and interest rate benefits.

Check out SoFi to see how refinancing your student loans can help you.

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Student Loan Refinancing
If you are a federal student loan borrower you should take time now to prepare for your payments to restart, including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. (You may pay more interest over the life of the loan if you refinance with an extended term.) Please note that once you refinance federal student loans, you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income-based repayment plans, such as the SAVE Plan, or extended repayment plans.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

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Student loans can have a way of making you feel like a hamster in a wheel—spinning like crazy but getting nowhere fast. And while knowing that around 44 million Americans carry student loan debt might offer some comfort in a “misery loves company” kind of way, the magical loan-forgiveness fairy is still—as far as we know—a myth.

In the meantime, though, there’s a bit of good news—you may have more control than you think. We are here to help illuminate some options available to student loan holders, so they can make decisions that fit best with their financial goals.

Have you been considering one of those options—choosing whether to consolidate or refinance student loans?

But what is consolidation, what is refinancing, and how do you know which one (if either) may be right for you?

This could be a somewhat complicated question, especially since these terms are sometimes used interchangeably. For example, consolidation simply means combining multiple student loans into one loan, but you have different options and can end up with different results by consolidating with the federal government vs. consolidating with a private lender.

Student loan refinancing is when you receive a loan with new terms and use that loan to pay off one or more existing student loans.

Consolidate vs. Refinance. Let’s break it down.

Here’s a simple overview of the different types of student loan consolidation, how they differ from student loan refinancing, and some tips for evaluating whether one of these options might work for you.

Federal Student Loan Consolidation

Federal student loan consolidation is offered by the government and is available for most types of federal student loans—no private loans allowed. When you consolidate with the government, your existing federal loans are combined into one new loan with a new rate, which is a weighted average of your old loans’ rates (rounded up to the nearest eighth of a percent).

This option may not save you any money, but there are still a few potential benefits:

1. Fewer bills and payments to keep track of each month.

2. The ability to switch out older, variable rate federal loans for one, new, fixed rate loan, which could protect you from having to pay higher rates in the future if interest rates go up. (Note: the last variable rate federal student loans were disbursed in 2006. Since then, all federal student loans have been fixed-rate.)

3. Lower monthly payments. But beware—this is usually the result of lengthening your repayment term, which means you might pay more interest over the life of the loan.

Private Loan Consolidation

Like federal consolidation, a private consolidation loan allows you to combine multiple loans into one, and offers some of the same potential benefits listed above. However, the interest rate on your new, consolidated loan is not a weighted average of your old loans’ rates.

Instead, a private lender will look at your track record of managing credit and other personal financial information when deciding whether to give you a new (ideally lower) interest rate on your new consolidation loan.

Bottom line: when you consolidate student loans with a private lender, you are also in fact refinancing those loans. When federal student loans are consolidated or paid off using a private loan, however, it’s important to know you will lose access to certain benefits such as income-driven repayment plans, forbearance and deferment options, and Public Service Loan Forgiveness (among others).

Student Loan Refinancing

As noted above, student loan refinancing is when a new loan from a private lender is used to pay off one or more existing student loans. If your financial situation has improved since you first signed on the dotted line for your original student loans(s), you may be able to refinance student loans at a lower interest rate and/or a different loan term, which could potentially allow you to do one or more of the following:

1. Lower your monthly payments.

2. Shorten your loan term to pay off debt sooner.

3. Reduce the money you spend in interest over the life of the loan.

4. Choose a variable interest rate loan, which can be a cost-saving option for those who plan to pay off their loan relatively quickly.

5. Enjoy the benefits of consolidation, including one simplified monthly bill.

Unlike federal loan consolidation, student loan refinancing is only available from private lenders. However, SoFi will refinance both private student loans and federal student loans, so well-qualified borrowers can consolidate all of their loans into one with loans and/or terms that work better for them.

Things to Consider

While there are advantages to both consolidation and refinancing, sometimes the answer—depending on timing, your budget, or other outside factors—could be to leave well enough alone. As you research your options, consider asking yourself these questions:

What kind of student loans do you have?

Refinancing federal student loans through a private lender might result in a lower interest rate, but you will also lose access to the benefits that come with federal loans, such as Public Service Loan Forgiveness (PSLF), flexible repayment plans, the ability to pause payments, and an interest rate that’s determined by Congress—not your credit score.

If your loans are private, they were issued based on creditworthiness to begin with, so a refinanced loan will follow similar qualifications, and each private lender will have its own underwriting criteria.

What is the loan payoff amount?

While the amount of a monthly payment is important, especially if a refinance could reduce it, it’s wise to read through all the terms of the loan to understand the big picture.

Are the monthly payments lower because the loan is now on a 20-year term instead of a 10-year term? Are there loan origination fees rolled into the payment? Knowing the full, total repayment amount can help ensure that short-term gains don’t bite you in the long run.

What’s the goal?

Consider your reasons for a refinance or consolidation—lowering monthly payments, keeping better track of due dates, or paying off debt as quickly as possible will likely lead to different strategies.

Your monthly budget and what you can (and can’t) afford to put toward your loan repayment will also play a factor here. One way to help ensure the right decision for you is to play with your budget a bit to see which loan options might benefit you most.

What factors do lenders review?

This isn’t typically an issue when it comes to consolidating loans through the federal government. But people interested in refinancing student loans with a private lender will likely need to meet various lender requirements, much like they would for a mortgage or personal loan.

Lenders generally review information like the borrower’s credit history, income, debt-to-income ratio, and other factors to determine what type of interest rate and loan terms they may qualify for.

You may not be able to change the fact that you have student loans, but you can make smart decisions about them. And that’s what ultimately gives you power over your debt. For more information about student loans, you can explore SoFi’s student loan help center to find guidance and gain knowledge to help point you in the right direction.

Ready to refinance your student loans? Start today!

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$500 Student Loan Refinancing Bonus Offer: Terms and conditions apply. Offer is subject to lender approval, and not available to residents of Ohio. The offer is only open to new Student Loan Refinance borrowers. To receive the offer you must: (1) register and apply through the unique link provided by 11:59pm ET 11/30/2021; (2) complete and fund a student loan refinance application with SoFi before 11/14/2021; (3) have or apply for a SoFi Money account within 60 days of starting your Student Loan Refinance application to receive the bonus; and (4) meet SoFi’s underwriting criteria. Once conditions are met and the loan has been disbursed, your welcome bonus will be deposited into your SoFi Money account within 30 calendar days. If you do not qualify for the SoFi Money account, SoFi will offer other payment options. Bonuses that are not redeemed within 180 calendar days of the date they were made available to the recipient may be subject to forfeit. Bonus amounts of $600 or greater in a single calendar year may be reported to the Internal Revenue Service (IRS) as miscellaneous income to the recipient on Form 1099-MISC in the year received as required by applicable law. Recipient is responsible for any applicable federal, state, or local taxes associated with receiving the bonus offer; consult your tax advisor to determine applicable tax consequences. SoFi reserves the right to change or terminate the offer at any time with or without notice.

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Student Loan Refinancing
If you are a federal student loan borrower you should take time now to prepare for your payments to restart, including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. (You may pay more interest over the life of the loan if you refinance with an extended term.) Please note that once you refinance federal student loans, you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income-based repayment plans, such as the SAVE Plan, or extended repayment plans.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

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