Are There First-Time Homebuyer Student Loan Forgiveness Programs?

Find out your options for student loan forgiveness

Nurse arriving home

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Buying a home for the first time is exciting. However, it can also be challenging if you have thousands of dollars in student loan debt. After all, lenders will assess your ability to make your mortgage payments, and if you have too much student loan debt, they may be hesitant to approve you for a loan.

There may be some options for you to get your student loans forgiven as a first-time homebuyer. It all depends on factors such as where you live or work, how much you earn, and the types of loans you have.

Key Takeaways

  • The Biden Administration and the U.S. Department of Urban Development are working to make homeownership easier for borrowers with student loans.
  • As a first-time homebuyer, you may qualify for a state-level student loan forgiveness program.
  • The federal government also offers student loan forgiveness programs, including Public Service Forgiveness and Teacher Loan Forgiveness.

Can First-Time Homebuyers Get Student Loans Forgiven?

Currently, student loan forgiveness programs for first-time homebuyers exist at the state level. While there aren’t any federal options available, as of 2022, the Biden Administration and the U.S. Department of Urban Development are exploring ways to remove barriers to homeownership for those with student loans.

In the past, FHA mortgage lenders were required to calculate a borrower’s monthly loan payment as 1% of their outstanding balance for loans that aren’t in repayment. This included borrowers who were in deferment or under an income-driven repayment (IDR) plan. Since newer rules remove this requirement, lenders are now able to use borrowers’ actual monthly loan payments, making approval easier.

In addition, the Biden Administration has wiped away student loan debt for victims of forgery as well as for disabled veterans. Additionally, there are plans to resolve administrative issues that previously denied loan forgiveness to certain borrowers enrolled in an IDR plan. According to the U.S. Department of Education, this initiative will lead to student loan debt cancellation for at least 40,000 borrowers, who will eventually be eligible for Public Service Loan Forgiveness.

States Offering Special Student Loan Forgiveness Programs

First-time homebuyers aren’t the only ones eligible for certain state programs offering student loan forgiveness. Here’s a brief overview of the programs that currently exist in various states.


The California State Loan Repayment Program offers to pay up to $50,000 in student loans for doctors, dentists, dental hygienists, physicians, nurses, pharmacists, certified midwives, and mental health professionals. To qualify, you must work in the public sector or nonprofit in an area with a shortage of health care workers. The state also requires that you commit to at least two years of full-time or four years of part-time employment.


Delaware offers the Delaware State Loan Repayment Program (SLRP). It awards anywhere between $30,000 to $100,000 to residents with advanced degrees in behavioral/mental health, dentistry, and medicine. To be eligible, you must work in a medically unserved area for at least two years on a full-time basis or four years part-time.


The Georgia Board of Health Care Workforce (GBHCW) has several repayment assistance programs. These programs are intended for health care professionals in the state who work at least 40 hours per week in rural areas with populations of 50,000 or less. Lincoln, Monroe, and Polk are a few of the cities that qualify as a rural area.


Iowa offers student loan repayment assistance programs for residents who work full-time in rural areas that need professionals in certain fields. It’s designed for doctors, teachers, health care workers, lawyers, veterinarians, and other health professionals. Through these programs, participants can have from $4,000 up to $200,000 of their federal student loans paid off, depending on the program.


Kansas has student loan repayment assistance programs in its Rural Opportunity Zones, offered by the Kansas Department of Commerce. If you move to the state and work in a city such as Wallace, Rush, Franklin, or Pawnee for a qualifying employer, you can get a 100% personal income tax credit and up to $15,000 to repay your student loans over a five-year period.


Through the Opportunity Maine Tax Credit, you can get reimbursed for your student loan payments. To qualify, you must be a full-time resident of Maine and meet other criteria based on when you graduated.


The SmartBuy 3.0 program in Maryland provides up to 15% of the purchase price of a home or $30,000 (whichever is less) to repay your student loans. To be eligible, you must live in the state, have a down payment of at least 5%, purchase a state-owned property, and have a minimum credit score of 720.


If you’re a health care provider in a Health Professional Shortage Area in Michigan, you may secure up to $300,000 in student loan forgiveness. The program is for dentists, doctors, and mental health care providers. It requires you to work full-time for at least two years in a nonprofit health clinic in an area with a shortage of health care professionals.


There are a number of student loan repayment assistance programs in Texas. These include Nursing Faculty Loan Repayment Assistance Program, the Teach for Texas Loan Repayment Assistance Program, and the Texas Access to Justice Foundation’s Student Loan Repayment Assistance Program.

Other Ways To Get Loan Forgiveness

While these state programs are worth exploring, it’s a good idea to also look into the student loan forgiveness programs offered by the federal government, such as:

  • Public Service Forgiveness: Public Service Loan Forgiveness is for public service workers such as teachers, nurses, and firefighters. To qualify, you must be a qualified full-time employee at a government entity or nonprofit organization. You should also be participating in an income-driven repayment plan. Once you’ve made 120 qualifying payments, the remaining balance on your loans may be forgiven.
  • Teacher Loan Forgiveness: Teacher Loan Forgiveness is a federal program for full-time teachers who work in low-income schools or educational service agencies. It was created to encourage teachers to work in areas with a shortage of qualified teachers. To be eligible, you must be considered a highly qualified teacher by the U.S. Department of Education and have federal student loans.

Frequently Asked Questions (FAQs)

How do you apply for student loan forgiveness?

You can apply for federal student loan forgiveness through the U.S. Department of Education. If you’re interested in a state-run forgiveness program, you’ll have to follow its unique application requirements.

Can you get private student loans forgiven?

Private student loans do not qualify for federal forgiveness programs. However, if you have them, you may want to consider refinancing to lower your monthly payments and make repayment more affordable.

How long does it take to get student loan forgiveness?

The amount of time it takes to get student loan forgiveness depends on the program. If you apply for Public Service Forgiveness, for example, you’ll need to make 120 qualifying payments before your loans are forgiven.

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  1. U.S. Department of Urban Development. “Federal Housing Administration Takes Steps To Remove Barriers to Homeownership for Those With Student Loan Debt.”

  2. NPR. “Student Loan Borrowers Will Get Help After an NPR Report and Years of Complaints.”

  3.  ​State of California. “California State Loan Repayment Program (SLRP)."

  4. “Delaware State Loan Repayment Program (SLRP)."

  5. ​​Georgia Board of Health Care Workforce. “Loan Repayment Programs."

  6. “Teach Iowa Scholar Program.”

  7. “Rural Iowa Primary Care Loan Repayment Program.”

  8. Kansas Department of Commerce. "Rural Opportunity Zones.”

  9. Maryland Department of Housing and Community Development. “Fact Sheet: Maryland SmartBuy 3.0."

  10. “Michigan State Loan Repayment Program Overview."

  11. Texas Higher Education Coordinating Board Student Loans. “Teach for Texas Loan Repayment Assistance Program.”

  12. U.S. Department of Education. “Public Service Loan Forgiveness Form."

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