How to Pay off Your Loans
- Employment: Many graduates choose to repay their student loans with a portion of the salaries they are earning in their new careers.
- Public Service: Under this program, individuals may qualify for forgiveness if employed by certain public service employers. Have more questions about this, review these Q&A.
- National Health Service Corps: Through this program, graduates have the opportunity to work in underserved communities, in exchange for loan forgiveness. Up to $50,000 in qualifying loans will be repaid by NHSC in return for a two-year commitment to the program. Eligible loan repayment recipients are Psy.D. graduates from APA-accredited programs.
- NIH Loan Repayment Programs: The National Institutes of Health maintains several loan repayment programs for qualified Psy.D. graduates who make commitments of at least two years to clinical or behavioral research. NIH will repay up to $35,000 per year of educational debt, plus an additional 39 percent to cover federal taxes. Specific loan repayment programs include:
- Health Disparities Research: 50 percent of the awards will be made to health professionals who are members of identified health disparity populations
- Clinical Research
- Pediatric Research
- Researchers from Disadvantaged Backgrounds
- Americorps: Service programs such as Americorps provide awards to repay student loans in exchange for work
- Indian Health Service (HIS) Loan Repayment Program: For graduates committed to practicing at an HIS or other Indian health program priority site
Don't Borrow Blindly--View this document from the National Association of Student Financial Aid Administrators on examples of student repayment plans.
There are a variety of options in terms of how quickly you may repay your loans. We encourage you to contact the U.S. Department of Education directly to discuss these repayment options.
Standard or level repayment: the most common and typically the least expensive option in terms of total interest costs. This plan provides a fixed monthly payment of at least $50 over a period of up to 10 years. If your monthly payments under this plan exceed 8-10 percent of your gross monthly income, you might want to consider another repayment option or loan consolidation.
Graduated repayment: monthly payments start low and increase over time. This may be a good choice if you have limited income to start, but expect higher earnings in the future. The maximum repayment under this plan is 10 years. Total interest costs are higher than those for the standard plan.
Income-sensitive repayment plan: payments can be adjusted up or down annually to account for changes in your income. The repayment period of 10 years can be extended to 15 years under a special forbearance provision. Total interest costs are higher with this plan than with the standard/level repayment.
Loan consolidation: allows you to bundle all of your federal education loans into one convenient single monthly loan payment at a fixed rate. Depending on your total outstanding loan balance, you may also be able to extend your repayment period and lower your monthly payments. You may only consolidate your loans once you have graduated or have entered repayment.