Grants to Pay Off Student Loans

If you have student loans, you can get help paying them off with grants. Grants to pay off student loans come in many forms, such as federal, state, and private grants.

Access to these grants can have a significant impact on your future––without needing to look for a needle in a haystack. We’ve used our resources, so you won’t have to. Below, you’ll find our detailed research on 12 grants to pay off student loans.

How can you use grants to pay off student loans? 

If you meet the criteria to apply for a grant and are awarded one, the funds are most often sent to your lender on your behalf.

Some grantors will make direct payments to an awardee. This may be a more common option within for-profit organizations offering grants to pay off employees’ student loans. 

The awarding organization should inform you of the process—often during the application process, but at the latest, once it informs you that you’ll receive the grant.

FYI: Scholarships and grants are nontaxable if a degree-seeking student uses the money to cover qualified expenses at an eligible educational institution. Qualified expenses include:

• Tuition and fees required for enrollment or attendance.
• Course-related expenses required of all students, such as fees, books, supplies, and equipment (e.g., computers).

Some grants are treated similarly to scholarships, and amounts used for qualified education expenses are tax-free. These typically include:

• Fulbright Grants
• Pell Grants
• Other Title IV need-based education grants

If you’ve earned one of these grants and used the funds appropriately, the money is not taxable. However, we recommend consulting a tax professional for any assistance or questions related to your personal situation.

Eric Kirste, CFP®

12 grants to help pay student loan debt 

Grants are awarded to students who can demonstrate financial need. Unlike most scholarships, grants primarily focus on the student’s academic achievements, and some have fewer merit-based criteria that applicants must meet.

We’ve organized these grants so you can easily navigate and learn more about the ones that apply to you.

Grants from the U.S. Department of Education (DoE)

The DoE offers these grants to students who can demonstrate financial need.

Federal Pell Grant 

This is a federal grant typically offered to undergraduate students.

TEACH Grant

The Teacher Education Assistance for College and Higher Education (TEACH) Grant Program is available to students in exchange for teaching full-time at a low-income school or education service agency for four years.

Grants for service 

These grants are available to individuals who commit a significant amount of their time or careers to volunteer or public service.

Segal AmeriCorps Education Award

AmeriCorps offers this grant to individuals who complete their term of service within a year and enroll in the National Service Trust.

Grants for law professionals

These grants are available to attorneys who work in government or government-contracted institutions.

John R. Justice (JRJ) Grant Program

The U.S. Department of Justice (DOJ) offers this grant to licensed, full-time local and state prosecutors and local, tribal government, state, and federal public defenders.

The Department of Justice Attorney Student Loan Repayment Program

The DOJ offers this grant to attorneys employed by the department who commit to serving there for three years. 

Grants for health professionals

These grants are available to individuals in the medical field.

National Health Service Corps Students to Service Loan Repayment Program (LRP) 

The National Health Service Corps offers this grant to students pursuing a degree in allopathic or osteopathic medicine, physician assistant studies, nursing, or dentistry, who also provide care to underserved populations.

Indian Health Service (IHS) LRP

The Federal Health Program for American Indians and Alaska Natives offers the IHS Grant to health professionals who work for two years in facilities serving American Indians and Alaska Natives.

Nurse Corps LRP

The HHS’s Health Resources and Services Administration (HRSA) agency offers this grant to licensed nurses who work for a critical shortage facility or eligible nursing school for two years.

Grants for specialized healthcare and research

The following grants are available to professionals in healthcare fields, including counseling, substance abuse, and behavioral medicine.

The National Institutes of Health (NIH) LRP

The U.S. Department of Health and Human Services (HHS) offers this grant to NIH and non-NIH researchers committed to the institute’s missions.

National Health Service Corps (NHSC) LRP 

The NHSC offers the following two grants below––and several others––to licensed healthcare professionals, including doctors, midwives, therapists, and social workers, who commit to service at an NHSC-approved facility.

NHSC Substance Use Disorder (SUD) Workforce LRP

This grant is available to medical and behavioral health professionals treating opioid addiction in underserved areas.

NHSC Rural Community LRP

This grant is available to health professionals treating opioid addiction in rural communities.

Before you apply, be sure to compare all NHSC grants to determine which one is best for you.

As you continue your research for help paying off your student loans, check out our take on grants for colleges. 

One important detail: Some scholarships are awarded to current, past, and graduate students. If you research on your own, you may come across some of these scholarships, which include the Charles Cheesman Student Debt Reduction Scholarship. 

Find out more about these awards by visiting scholarship, grant, and fundraising platforms such as Bold.org.

How do you apply for a grant to pay off student loans?

Applying for a grant to pay off student loan debt usually starts with contacting the department or organization issuing the grant program. 

Grantors typically facilitate the application process online. Visit their respective websites for specific instructions to guide you through the process. 

Many of the grant programs we covered above are available on a time-contingent work agreement, where you commit to work for a set time frame in exchange for the funds. So make sure you read the eligibility requirements before you apply; you may need to fulfill your work commitment before applying.

When searching for grants, it’s essential to be cautious of potential scams. Some individuals and organizations prey on vulnerable borrowers. Always research and verify any grant program or organization before sharing personal information or paying fees.

To navigate the grant landscape, use reputable resources, such as the U.S. Department of Education’s Federal Student Aid portal, or scholarship search engines such as Bold.org. Be wary of unsolicited offers or requests for payment in exchange for grant information—these are common scam indicators. Thorough research and due diligence are crucial when pursuing grant opportunities for student loan repayment.

Eric Kirste, CFP®

Other ways to get help paying off student loans

If you don’t qualify for grants or they’re not enough to cover your loans, you might have other options to ease your student loan burden.

Federal student loan repayment assistance

The federal government offers several programs that can help with student loan repayment. These programs are usually based on income or employment in certain fields.

• Forgiveness programs: Public Service Loan Forgiveness (PSLF) and Teacher Loan Forgiveness can forgive a portion or all of your loans if you meet specific requirements. PSLF, for example, forgives federal student loans after 120 qualifying monthly payments while working full-time for a government or nonprofit organization.
• Income-driven repayment plans (IDR): IDR plans adjust your monthly payment based on your income and family size, with payments potentially as low as $0. After 20 to 25 years, any remaining balance on your loan can be forgiven.

Post-graduation scholarships

Many states, industries, and companies offer scholarships for recent graduates that help pay off student loans.

• State-based scholarships: Some states provide loan repayment assistance for residents working in high-need areas, such as healthcare or education. For example, New York’s Get On Your Feet Loan Forgiveness Program helps eligible residents with federal student loans during their first two years after college.
• Industry-based scholarships: Many professional associations offer scholarships to individuals working in fields that require specialized skills, including nursing and law. These scholarships sometimes take the form of loan repayment.
• Company-based scholarships: More employers are providing student loan repayment as part of their benefits package. For example, Fidelity and Chegg offer programs that help employees pay off their student loans.

Private student loan refinancing

If you’re struggling to manage high-interest student loans, refinancing through a private lender may reduce your interest rate and lower your monthly payments. This can help you save money over the life of the loan. However, refinancing federal loans means giving up benefits such as income-driven repayment and forgiveness programs, so it’s essential to consider the trade-offs.

Read More

Best Student Loan Refinance Companies