Guide to Michigan Student Loan Forgiveness Programs

Nancy BilyeauUpdated August 1, 2023

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People who hold student loans can turn to state programs for help with repayment as well as the federal government. For Michigan residents, there are three programs set up to provide loan repayment relief for people who work in certain areas of the medical or legal professions.Read on to learn the details about student loan forgiveness in Michigan and other avenues for repaying student loans.

Does Michigan Have Any Student Loan Forgiveness Programs?

Yes, Michigan has several state programs that were created to help people receive forgiveness for the student loans they took out to pay for their education. In this context, “forgiveness” means loan holders are released from having to repay part or all of their student loans. The money is no longer owed.

1. Michigan State Loan Repayment Program

The Michigan State Loan Repayment Program (MSLRP) helps employers recruit and retain primary medical, dental, and mental healthcare providers by providing loan repayment to those entering into service obligations.The providers must continue to demonstrate their commitment to building long-term primary care practices in underserved communities designated as Health Professional Shortage Areas (HPSAs). MSLRP will assist those selected by providing up to $300,000 in tax-free funds to repay their educational debt over a period of up to ten years. Providers who have defaulted on federal loans are not eligible.

2. John R. Justice Student Loan Repayment Program

The John R. Justice Student Loan Repayment Program (JRJ) provides funding for federal student loan repayment for eligible public defenders and prosecuting attorneys who agree to remain employed within Michigan for at least three years. Note: Funding is not available in every state or in every year. In 2022 this program did not allocate any money to Michigan residents.

3. Michigan Law’s School Loan Repayment Assistance Program

The Debt Management Programs at the University of Michigan Law School “provide graduates with maximum flexibility to choose jobs from any law-related area (excluding judicial clerkships and U-M funded fellowships), including modest-paying public interest positions, while still maintaining a reasonable lifestyle and remaining current on outstanding loan obligations. Graduates whose combination of income and debt make them eligible receive assistance in meeting their loan obligations incurred during law school.” University of Michigan law school graduates with questions should contact the debt management program.

Can You Get State and Federal Student Loan Forgiveness?

Applying for and receiving federal-loan forgiveness does not cancel out state aid, with some exceptions. It’s important to master the rules of Michigan student loan forgiveness before you apply.For example, you can participate in the federal Public Service Loan Forgiveness program and the Michigan State Loan Repayment Program at the same time. However, you can apply for MSLRP and the National Health Service Corps Loan Repayment Program (NHSC LRP) at the same time but you can only participate in one at a time.Also, it’s important to be aware of any state tax consequences to receiving state loan forgiveness.

Other Ways to Pay Back Student Loans

With the federal student loan portfolio currently totaling about $1.7 trillion, owed by more than 43 million borrowers, student debt seems like a national crisis. Students are encouraged to take full advantage of need-based financial aid as well as grants and scholarships through filling out their FAFSA form. Many people have been taking out loans, mostly federal but also private, to fund their education. As a result, student loan debt makes up the second largest amount of debt in the nation, behind only mortgages. The average federal student loan debt is $36,510 per borrower and private student loan debt averages $54,921 per borrower, according to recent data from Educationdata.org. Finding help for getting out of this debt has never been more urgent.

Federal Student Loan Forgiveness

Loan forgiveness comes in several forms when it’s federal student loan debt.

Student Loan Refinancing

People interested in refinancing their federal loans to achieve lower interest rates or different terms can explore the pros and cons of this approach. Note: If you refinance your student debt, that amount is no longer eligible for federal student loan forgiveness or debt cancellation.

Income-Based Repayment Plans

Income-driven repayment (IDR) plans are not the same as student loan forgiveness. They are designed to make student loan debt more manageable by reducing the monthly payment amount. For people in financial distress, they can be a lifeline. However, they are strictly based on income and family size.

The Takeaway

Michigan residents in the medical or legal fields may be able to pursue state loan forgiveness programs. The qualifications are governed by what kind of specific job you have, what population you served, and in one case, where you went to school for Michigan student loan forgiveness.Federal student loan forgiveness programs also exist, whether it is Public Service Loan Forgiveness or an income-driven plan. Or you may want to explore refinancing your loan through a private lender. You can compare refinancing rates through Lantern.

Frequently Asked Questions

Does Michigan offer student loan forgiveness programs?

Who qualifies for Michigan student loan forgiveness programs?

Can you use both federal and state student loan forgiveness programs?

iStock/Sean Pavone

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About the Author

Nancy Bilyeau

Nancy Bilyeau writes about student loans, mortgages, car insurance, medical debt and many other finance topics for Lantern. A veteran of the magazine business, she has edited stories on personal finance for Good Housekeeping and DuJour magazines and has written articles for The Wall Street Journal, Readers' Digest, Parade, Town & Country and Lifetime/A&E, among others. She is a graduate of the University of Michigan.

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