If you're pursuing higher education in the United States, you'll likely need to take out a student loan to afford it. This is often the case regardless of where in the country you're enrolled; however, student loan debt does vary by state, so students seeking the same kind of degree may owe more or less than their peers in other regions.
But wherever you live, most states have student loan forgiveness programs that may offer relief for graduates struggling to pay off their debt.
- According to the Institute for College Access & Success, 19 states reported an average debt of more than $30,000 in 2020, while six states reported average amounts of over $35,000.
- At $39,928, borrowers in New Hampshire had the highest average student debt burden. Conversely, at $18,344, Utah's graduates owed the least in student debt on average, and it was the only state with a figure below $20,000.
- At $64,354, the District of Columbia had the highest total on-campus cost of attendance in 2019–2020, while Idaho had the lowest at $19,296.
- Minnesota has the most student loan forgiveness programs.
- North Dakota is the only state that does not have a dedicated student loan forgiveness program, though the state does offer loan repayment assistance to certain professions, like those in the medical field.
Understanding Student Loan Debt Forgiveness
Student debt is what's owed when a borrower takes out either a federal or private loan to cover the costs of higher education, which can include—among other things—tuition, textbooks, other school supplies, and basic living expenses. As of December 2022, Americans collectively owed $1.76 trillion in student loan debt. To put that number in context, that's more than the gross domestic product (GDP) of all but eleven countries in 2021.
Even when accounting for potential scholarships or parental financial assistance, most people will likely still need a loan. Additionally, the cost of education has risen over time, meaning even larger sums may be required in the future.
Student debt is a reality for over 45 million Americans, and there are myriad of reasons why someone would be unable to repay their loans. Delinquency in repayments can eventually lead to a loan going into default, both of which have long-lasting impacts on a borrower's credit score and credit report.
And even if someone is able to keep up with their loan payments, this expense can make it harder to save for bigger purchases or even an emergency fund.
Fortunately, there are programs available that offer student loan forgiveness to graduates struggling to manage their debt burdens. In addition to the student loan forgiveness options provided by the federal government—which are available to anyone who meets the criteria regardless of their location within the U.S.—individual state governments may also have their own debt cancellation programs.
Below is our analysis of how student loan balances and forgiveness programs differed by state in 2020; the most recent data is provided by The Institute for College Access & Success.
Student Loan Debt by State
According to the Institute for College Access & Success, 19 states reported an average debt of more than $30,000 in 2020, while six states reported average amounts of over $35,000. Many of the same states appeared at the higher and lower ends of this range as they did in previous years. States with larger amounts of debt remained concentrated in the Northeast, while states with smaller student debt burdens were mainly in the West.
At $39,950, borrowers in New Hampshire had the highest average student debt burden. Conversely, at $18,350, Utah's graduates owed the least in student debt on average, and it was the only state with a figure below $20,000.
In addition to the size of the debt, the loan burden is also measured by the percentage of students who carry debt. The same report found that for the 2019 to 2020 academic year, 73% of graduates in South Dakota had student loan debt, the highest percentage in the U.S. Likewise, at 39%, Utah had the lowest percentage of graduates with student loan debt for this same period.
At 27% of graduates, North Dakota had the highest rate of private borrowing, with New Hampshire's just two percentage points lower. However, New Hampshire's nonfederal debt as a percent of total debt was only the sixth highest in the country at 38%. North Dakota ranked 15th on that measure with 29%. Utah had the lowest rate of private debt utilization with only 3% of 2020 graduates exiting with private debt. But nonfederal debt accounted for the smallest percentage of total debt in Nevada (3%).
Although not a state, at $64,354, the District of Columbia had the highest average total on-campus cost of attendance in 2020. At $53,853, Massachusetts had the second-highest. The state with the lowest cost of attendance was Idaho, at $19,296. Additionally, Vermont had the highest average tuition and fees at $31,764, accounting for 72.35% of the total cost of attendance. Wyoming's $4,747 in tuition and fees made up just 31.86% of its total cost of attendance.
Lastly, by subtracting the average total cost of attendance of each state from its respective average student loan debt, we can see which parts of the U.S. generally offer more student aid than the minimum amount required. The excess cash can go toward off-campus living expenses or debt repayment after graduation.
Twenty-seven states have attendance costs lower than the average graduate debt. North Dakota borrowers had an average of $12,592 left after accounting for the cost of attendance. Conversely, at -$27,194 on average, students in the District of Columbia will have to pay far more for their education than their mean student loan amount covers.
Student Loan Forgiveness by State
As of June 2022, 49 states and the District of Columbia offer at least one student loan forgiveness program. There are a total of 129 state-level student debt cancellation plans in the U.S. Minnesota has the most student loan forgiveness programs. North Dakota is the only state that does not currently have its own dedicated student debt cancellation options. These programs are subject to change or close at any time and states can offer new ones as well.
Most education loan forgiveness plans are designed to help borrowers in specific professions so as to attract more students seeking the same careers to a particular state (for example, doctors, science and math teachers, lawyers, etc.).
That this allows the state to potentially draw multiple kinds of workers into the local economy is also why a state might offer more than one program. Because economic circumstances will also differ by state, other variations are likely to exist among programs pertaining to the same careers. Below are the three areas that can differ the most from program to program.
- Amount: Among all U.S. state programs, the amount of educational debt that can be forgiven can range from thousands to tens of thousands of dollars. Additionally, some debt cancellation plans offer different amounts of debt forgiveness depending on the applicant. For instance, Florida's Nursing Student Loan Forgiveness Program (NSLFP) offers a flat rate of up to $4,000 per year.
- Eligibility: Each student loan forgiveness program has a set of criteria that borrowers must meet in order to have their debt forgiven. On a basic level, applicants typically must be a citizen of the U.S. and/or the relevant state, have outstanding educational debt, and be actively working in the required profession. The Massachusetts Loan Repayment Program (MLRP) for health professionals, for example, is available to a wide variety of healthcare workers, whereas Missouri's Health Professional Nursing Student Loans program is, as the name implies, only available to nurses.
- Application process and cycle: Unlike the procedure for federal programs, there is no standard procedure for applying to state loan forgiveness programs. For example, not all states have online application processes available on their websites. Some simply require emailing an individual involved in the program. Required information and/or documentation also varies.
Although federal loan forgiveness options are available for U.S. citizens in any part of the country, state programs are still worth looking into, regardless of whether a borrower is a graduate or a prospective student trying to decide which school to attend.
In fact, certain programs were implemented in an effort to attract more workers in highly sought-after fields within a state's communities. Iowa's Health Professional Recruitment Program (HPRP), for example, was established to increase the number of athletic trainers, occupational therapists, physicians, physician assistants, podiatrists, and physical therapists practicing in high-need communities.
Although no one should plan their academic future around having to seek debt cancellation, there's no harm in students who are seeking higher education in these coveted fields researching which programs could serve as a backup plan should they encounter some sort of financial hardship.
Below is a list of each state's student loan forgiveness program in the U.S.:
- Joyce Holsey’s ALL (Arizona’s Legal Legacy) Loan Repayment Assistance Program
- Primary Care Provider Loan Repayment Program (PCPLRP)
- Rural Private Primary Care Provider Loan Repayment Program (RPPCPLRP)
- Colorado Health Service Corps
- Colorado Law's Loan Repayment Assistance Program (LRAP)
- DU Loan Repayment Assistance Program (LRAP)
District of Columbia
- Florida Bar Foundation Loan Repayment Assistance Program (LRAP)
- Nursing Student Loan Forgiveness Program (NSLFP)
- Advanced Practice Registered Nurse Loan Repayment Program (APRNLRP)
- Dentists for Rural Areas Assistance Program (DRAA)
- Georgia Physician Loan Repayment Program (GPLRP)
- Physician Assistant Loan Repayment Program (PALRP)
- Physicians for Rural Areas Assistance Program (PRAA)
- Illinois Teachers Loan Repayment Program
- John R. Justice Student Loan Repayment Program (JRJ)
- Nurse Educator Loan Repayment Program
- Veterans' Home Medical Providers' Loan Repayment Program
- Health Care Award Program
- Health Professional Recruitment Program (HPRP)
- Rural Iowa Primary Care Loan Repayment Program
- Teach Iowa Scholar (TIS) Program
- Kansas Bridging Plan (KBP)
- Kansas State Loan Repayment Program (SLRP)
- ROZ Student Loan Reimbursement Assistance
- Louisiana Bar Foundation Loan Repayment Assistance Program (LRAP)
- Louisiana State Loan Repayment Program (SLRP)
- Educators for Maine Program
- Maine Dental Education Loan Program
- Maine Health Professions Loan Program
- Maine Veterinary Medicine Loan Program
- Janet L. Hoffman Loan Assistance Repayment Program (LARP)
- Maryland Dent-Care Loan Assistance Repayment Program (MDC-LARP)
- Maryland SmartBuy Program
- Dedicated to Minnesota Dentist Loan Repayment for Service Program
- Loan Repayment Assistance Program of Minnesota (LRAP Minnesota)
- Minnesota Dentist Loan Forgiveness
- Minnesota Long Term Care Nurse Loan Forgiveness
- Minnesota Nurse Faculty Loan Forgiveness
- Minnesota Rural Advanced Practice Provider Loan Forgiveness
- Minnesota Rural Dental Therapist/Advanced Dental Therapist Loan Forgiveness
- Minnesota Rural Mental Health Professional Loan Forgiveness
- Minnesota Rural Pharmacist Loan Forgiveness Program
- Minnesota Rural Physician Loan Forgiveness Program
- Minnesota Rural Public Health Nurse Loan Forgiveness
- Minnesota State Loan Repayment Program (SLRP)
- Minnesota Urban Advanced Practice Provider Loan Forgiveness
- Minnesota Urban Mental Health Professional Loan Forgiveness
- Minnesota Urban Physician Loan Forgiveness
- Health Professional Student Loan Repayment Program
- Health Professional Nursing Student Loans
- PRIMO Student Loan Program
- John R. Justice Federal Student Loan Redemption Program
- National Health Services Corp Program
- New Jersey STEM Loan Redemption Program
- Nursing Faculty Loan Redemption Program
- Primary Care Practitioner Loan Redemption Program
- New Mexico Health Professional Loan Repayment Program (HPLRP)
- New Mexico Public Service Law Loan Repayment Assistance Program (LRAP)
- Albany Law School Loan Repayment Assistance Program (LRAP)
- New York State Teacher Loan Forgiveness Program
- New York State Young Farmers Loan Forgiveness Incentive Program
- NYS Child Welfare Worker Loan Forgiveness Incentive Program
- NYS District Attorney and Indigent Legal Services Attorney Loan Forgiveness (DALF) Program
- NYS Get on Your Feet Loan Forgiveness Program
- NYS Licensed Social Worker Loan Forgiveness (LSWLF) Program
- NYS Nursing Faculty Loan Forgiveness (NFLF) Incentive Program
- Physician Loan Repayment
- Regents Physician Loan Forgiveness (LF)
- Forgivable Education Loans for Service
- NC LEAF Loan Assistance Repayment Program
- North Carolina State Loan Repayment Program (SLRP)
- Physician/Community Match Program
- Oklahoma Dental Loan Repayment Program (ODLRP)
- Oklahoma Physician Assistant Loan Repayment Program
- Oklahoma Physician Loan Repayment Program
- PA IOLTA Loan Repayment Assistance Program (LRAP)
- Pennsylvania Primary Care Loan Repayment Program (LRP)
- Attorney Student Loan Repayment Program (ASLRP)
- Nursing Faculty Loan Repayment Assistance Program
- Physician Education Loan Repayment Program (PELRP)
- Teach for Texas Loan Repayment Assistance Program (TFTLRAP)
- Texas Student Loan Repayment Assistance Program (SLRAP)
- Health Care Workforce Financial Assistance Program (HCWFAP)
- Rural Physician Loan Repayment Program (RPLRP)
- Dental Educational Loan Repayment
- Nursing Educational Loan Repayment
- Physicians, Nurse Practitioners, & Physician Assistants Educational Loan Repayment
- Vermont Bar Foundation’s Statewide Loan Repayment Assistance Program (VBF-LRAP)
- Herbert S. Garten Loan Repayment Assistance Program (LRAP)
- Virginia Loan Forgiveness Program (VLFP)
- Virginia State Loan Repayment Program (VA-SLRP)
What Are the Consequences of Unpaid Student Loans?
Unpaid student loans are considered delinquent, and loans that remain in delinquency can eventually go into default. Both delinquencies and defaults can negatively impact a borrower's credit score and credit report.
How Long Does a Default Stay on Your Credit Report?
Private and most federal student loans that are in default will remain on a borrower's credit report and reduce their credit score for seven years from the date of the late payment.
What Is Student Loan Forgiveness?
Student loan forgiveness refers to programs that—following a successful application and meeting their criteria—relieve borrowers of the requirement to repay some or all of their loan(s). There are education debt cancellation programs provided by both the federal government and state governments.
The Bottom Line
Data from the College Board shows that the number of graduates with student loan debt has been declining slightly. It would be good if this trend continues for the foreseeable future, but the continuously escalating cost of higher education makes that unlikely.
Meanwhile, the current debt crisis is also causing a decline in marriage rates, small business formations, the pursuit of career ambitions, and savings rates throughout the U.S. Waiting for the problem to resolve itself isn't advisable—and certainly isn't an option for the students and graduates shouldering this debt burden.
Although there are avenues available for student loan cancellation both on the federal level and in nearly every state, the public calls for change show that these programs have been insufficient to meet the needs of borrowers.
Although debt forgiveness won't completely eliminate the student lending gap between states, it may at least help level the playing field between the borrowers struggling to repay their loans in some regions and the debt-free graduates in other parts of the country.