How Student Loan Forgiveness Is Improving Home Buying Chances for Young Adults
In the past two years, there has been a lot of talk about student loan forgiveness. The government is looking to create a program designed to help qualifying individuals get out of student loan debt.
While there are many different opinions on this topic, student loan forgiveness could help young adults buy their first homes. This is a good thing that could have positive consequences for both the housing market and the economy in the long run.
In fact, the impact of student loan forgiveness on the housing market is already being seen.
Here are 5 States Willing to Pay Off Student Loans for Homebuyers
A growing number of cities and states are providing student loan repayment assistance programs to borrowers and you don’t even need to buy a home.
They’ll pay off loans for those who move there, buy a home there, or work in specific industries. How great is that?
Many of these programs are only available to people who have federal student loans and make timely payments. If you fall into both categories, here is where you can get a large portion of your student loans paid off.
Note: please follow the links in the blog to ensure that the program you want is still available.
The home of Lincoln recently announced a $25 million investment in its SmartBuy program to assist first-time homebuyers with student debt in purchasing a home. This program includes a $5,000 deferred-payment loan for a down payment, as well as up to $40,000 or 15% of the property’s value (whichever is less) toward student loan repayment. Your household income cannot exceed $109,200 to qualify.
One of the most generous student loan repayment plans on our list is provided by Michigan, with a cap of $200,000 for dentists, physicians, and mental health professionals. You must work full-time for a minimum of two years at a non-profit medical facility in a region with a shortage of medical professionals to be eligible for this award. A maximum of eight years are allowed for loan assistance eligibility.
Not a physician or dentist? Look into Huron or St. Clair County. If you move to either of these counties and have a degree in science, technology, engineering, the arts, or mathematics, you may be eligible for a reverse scholarship worth between $10,000 and $15,000 that will help you pay back your student loans. Both counties have given out 16 scholarships overall since the program began.
The Opportunity Maine Tax Credit is offered by the state if you have a STEM degree and student debt. The state would reimburse your minimum student loan payments as a credit on your state income taxes if you graduated after 2008 and reside and work in Maine.
Depending on the year you graduated, there may be additional restrictions and rules, so be sure to review the prerequisites. In addition to this benefit, the Finance Authority of Maine has a student debt relief program that, if you have a STEM degree and work for a Maine employer, will pay the first $50,000 of your outstanding student loan balance up to a maximum of $60,000.
The state of California will forgive up to $50,000 in student loans for nurses, physician assistants, dentists, and other healthcare professionals. You must be employed in the public sector or at a nonprofit organization in an area where there is a shortage of healthcare professionals to qualify for the California State Loan Repayment Program. To qualify for assistance, you must agree to work for at least four years at a reduced rate or two years at full-time employment.
The Lone Star State is willing to help with student debt if you work in the fields of education, law, or healthcare.
The Nursing Faculty Loan Repayment Assistance Program, Teach for Texas Loan Repayment Assistance Program, and the Texas Access to Justice Foundation’s Student Loan Repayment Assistance Program are just a few of the repayment assistance programs available in the state.
You may be eligible for financial aid ranging from $4,800 to $180,000, depending on the sector and program you apply for.
The Bottom Line: Student Loan Forgiveness is Helping Young Adults Buy Homes
So you don’t have to sit around waiting for the Federal Government to act. State programs like these are making it easier for young adults to qualify for a mortgage and buy a home.
It pays to do your research to see if your state offers such programs. Better still give your local Embrace Home Loans® office a call. We are your local experts with our ears to the ground and great information on our local and state programs.