Nurse Corps Loan Repayment Program

Quick Facts

Benefit type: Federal loan repayment program administered by the Health Resources and Services Administration (HRSA).
Who it serves: Registered nurses, advanced practice registered nurses, and nurse faculty committed to working in underserved communities or educating future nurses.
Financial benefit: Pays 60% of outstanding qualifying nursing loans over two years; participants may earn an additional 25% for a third year, totaling up to 85% repayment.
Service requirement: Full-time service at a critical shortage facility (CSF) or accredited school of nursing located in or serving a Health Professional Shortage Area (HPSA).
Application timeline: Annual application cycle opens early in the calendar year, with awards announced in late summer.

Program Overview

The Nurse Corps Loan Repayment Program (NCLRP) tackles nursing shortages by rewarding clinicians and educators who deliver care in areas with limited access. HRSA offers substantial loan repayment—up to 85% of eligible nursing education debt—in exchange for a multi-year commitment. Participants sign a contract to work full time in a qualifying CSF or as nurse faculty at an eligible nursing school. The program prioritizes applicants with the greatest financial need and those serving in facilities with high HPSA scores.

Funding is competitive; HRSA typically receives more applications than available awards. Applicants must demonstrate outstanding nursing loans, meet licensure requirements, and secure employment at an eligible site before applying. Awardees receive payments directly to loan servicers in quarterly installments and must continue to meet service obligations to remain in good standing.

Eligibility Requirements

To qualify you must:

Be a U.S. citizen, national, or lawful permanent resident. Proof of status is required during application.
Hold a valid, unrestricted license. Registered nurses and APRNs must hold a current license in the state where they practice. Nurse faculty must hold a valid nursing license and meet academic credentials.
Possess qualifying educational loans. Only loans taken for nursing education (associate, baccalaureate, graduate degrees) qualify. Private and federal loans are eligible if they were used for tuition, reasonable educational expenses, and living costs while enrolled. Consolidated loans must contain only qualifying nursing debt.
Work full time at an eligible site. Clinical nurses must serve at a CSF located in or serving an HPSA with a minimum score set annually (typically 14 or higher). Nurse faculty must have a contract with an accredited school of nursing located in a HPSA.
Have no service obligations. Applicants cannot have conflicting service commitments (e.g., National Health Service Corps, state loan repayment) that overlap with the NCLRP term.
Be free of federal judgment liens or defaulted debt. You cannot be delinquent on federal debt, including student loans, or have existing federal service obligations.

Additional Considerations

Part-time employment: The program generally requires full-time service (32+ hours/week in clinical settings). Part-time arrangements are not accepted, except for nurse faculty who may teach at least 9 credit hours or equivalent per term.
Telehealth: Service must involve face-to-face patient care or in-person teaching; telehealth-only positions typically do not qualify unless part of a larger in-person role.
Postgraduate trainees: Nurses in residency or fellowship programs do not qualify until they complete training and obtain full-time employment at an eligible site.

Benefit Details

Payment schedule: HRSA pays 30% of the total eligible loan balance at the beginning of each of the first two service years (totaling 60%). An optional third year provides an additional 25% of the original balance.
Taxation: Loan repayment amounts are considered taxable income, but HRSA withholds federal taxes and sends the net amount to your loan servicer. Participants receive a W-2 each year.
Eligible loans: Stafford, Perkins, Graduate PLUS, private nursing school loans, and consolidation loans containing only nursing debt. Parent PLUS loans and credit card debt are not eligible.
Interest accrual: The program pays accrued interest along with principal. You must continue to make minimum required payments until the first disbursement occurs.
Default or breach: Failing to complete service results in severe penalties, including repaying amounts paid plus interest and a penalty equal to the amount received.

Application Process

Confirm site eligibility: Use the HRSA HPSA Finder to verify your facility’s HPSA score. Obtain a signed employment verification from your CSF or school of nursing.
Gather loan documentation: Collect current loan statements showing outstanding balances, account numbers, and servicer details. Ensure consolidation loans include only nursing education debt.
Create a HRSA account: Register in HRSA’s Bureau of Health Workforce (BHW) Customer Service Portal.
Complete the online application: Provide personal information, licensure details, employment verification, loan documentation, and financial data (e.g., adjusted gross income). Upload required documents as PDFs.
Submit during application window: The cycle typically opens in February and closes in April. Late submissions are not accepted. Reviewers score applications based on debt-to-income ratio, HPSA score, and disadvantaged background status.
Respond to requests: HRSA may request additional information or clarification. Failure to respond by deadlines can disqualify you.
Accept award and sign contract: If selected, sign the service contract electronically. HRSA disburses payments quarterly once service begins.

Required Documentation Checklist

Proof of U.S. citizenship or residency (passport, birth certificate, green card).
Current nursing license for each state of practice.
Employment verification form signed by facility or school official.
Loan documentation: statements, promissory notes, payoff information, consolidation breakdowns.
Transcripts verifying completion of nursing education.
IRS Form 1040 or other proof of income for the previous tax year.
Void check or direct deposit form for payment routing.

Deadlines and Timing

Application window: Usually February through April; exact dates posted on HRSA’s website each year.
Award notifications: Typically late July to September via email and the BHW portal.
Service start date: Begins on the date specified in the contract, often October 1. Service must be continuous; no deferments are allowed except approved medical or military leave.
Third-year option: HRSA invites eligible participants near the end of the second year to apply for the optional continuation contract.

Interaction with Other Programs

Public Service Loan Forgiveness: Payments made by HRSA do not count as qualifying payments for PSLF because they are not borrower payments. However, working at a nonprofit CSF may still allow you to make PSLF-qualifying payments on remaining balances not covered by the program.
State loan repayment: Some states allow stacking with HRSA funds if service obligations do not conflict. Review state program rules carefully.
Employer tuition assistance: Employer-paid loan assistance may continue, but ensure combined benefits do not violate contract terms.
Income-driven repayment: Continue making reduced payments under IDR plans until HRSA payments take effect; once major portions of debt are repaid, reevaluate repayment strategy for remaining loans.

Maximizing Your Benefit

Select high-score sites: Employment at facilities with HPSA scores above the minimum improves selection chances. Consider rural hospitals, community health centers, or Indian Health Service facilities.
Reduce taxable income: Because HRSA withholds taxes, consult a tax advisor about adjusting withholding or contributing to retirement accounts to manage tax impact.
Maintain compliance: Submit in-service verification reports on time, continue full-time hours, and notify HRSA of any employment changes. Breaches trigger steep penalties.
Coordinate loan payments: Continue making minimum payments until HRSA disbursements begin to avoid delinquency. Once payments start, adjust automatic payments to reflect lower balances.
Plan for third-year continuation: Track contract milestones so you can apply for the optional third year promptly, maximizing the 85% repayment opportunity.

Common Mistakes to Avoid

Ineligible employment: Applying without a confirmed position at a qualifying CSF or school leads to automatic rejection.
Incomplete loan documentation: Missing statements or including non-nursing debt in consolidation loans can delay or deny awards.
Missing deadlines: HRSA strictly enforces submission deadlines. Set reminders for application, verification reports, and contract milestones.
Changing jobs without approval: Participants must receive HRSA approval before switching employers. Unapproved changes can be considered breaches.
Ignoring tax implications: Loan repayment funds are taxable. Budget for potential state tax liabilities that HRSA does not withhold.

Example Scenarios

Rural hospital RN: Jamie works at a critical access hospital with an HPSA score of 18 and $70,000 in nursing loans. She receives 60% repayment over two years ($42,000) and accepts the third-year contract for an additional $17,500.
Nurse practitioner at FQHC: Malik serves at a federally qualified health center in Seattle with an HPSA score of 20. With $90,000 in loans, he receives $54,000 over two years and plans to apply for the optional third year.
Nurse faculty: Dr. Chen teaches full time at an accredited nursing school in a shortage area. She receives 60% repayment on $60,000 of graduate loans and continues teaching to qualify for the third-year bonus.

Frequently Asked Questions

Can part-time faculty participate? Only if they meet HRSA’s minimum course load equivalent. Most awards go to full-time faculty.
What if I relocate? You must request HRSA approval before changing worksites. The new site must meet eligibility standards.
Are prior HRSA obligations allowed? You cannot have conflicting obligations, but previous participants who completed service may reapply if they incur new qualifying debt.
Does HRSA pay my servicer directly? Yes. Payments go to the loan servicer. Continue making payments until you receive confirmation that the account is credited.
Is there a penalty for withdrawal? Yes. Breaching the contract triggers repayment of all funds received plus damages up to $7,500.