It’s a novel concept for any state looking to hire qualified and skilled professionals–they’ll pay off your student loan debt in exchange of moving there. Illinois has recently joined Maryland in launching a “SmartBuy” initiative that will pay off your student loans if you take out a mortgage in their state. Here’s how it operates and how it compares to similar debt-reduction programs in other states.
How Illinois’ SmartBuy program works
According to Forbes, the state will pay up to $40,000 in student loans, or a student loan balance that’s 15% of the home purchase price, whichever amount is lower.
- The purchase price of a home is limited and capped, ranging from $325,000 to more than $500,000, depending on the geographic location and other factors.
- In the Chicago area, prospective homeowners must have a household income of no more than $109,200.
- If you need $5,000 to fund a down payment or closing costs, the program will provide it for you.
- There is one major stipulation: the $40,000 of debt relief must be used to repay all of the student loans. There are no exceptions to this rule.
Other state debt payment programs
Maryland has its own version of SmartBuy program, which pays off up to 15% of a home’s purchase price in student loans (you can find more details here). Aside from that, there are other debt reduction options, which are usually available to professionals in high-demand fields such as physicians, dentists, healthcare workers, and lawyers. The College Investor provides a comprehensive and complete list of state-by-state list of programs here.
In return for working full-time in Health Professional Shortage Areas (HPSAs) at not-for-profit health facilities for two years, the Michigan State Loan Repayment Program will cover up to $200,000 in student loans for primary medical, dental, and mental healthcare providers. More information can be found here.
The Delaware State Loan Repayment Program will pay up to $100,000 in student loans for primary medical, dental, and mental healthcare providers with provisions to work full-time in Health Professional Shortage Areas (HPSAs). More information can be found here.
If you plan to practice medicine full time in a rural county in Georgia, the Physicians for Rural Areas Assistance Program will pay off $25,000 of your student loans per year, up to a total of $100,000. Working 40 clinical hours per week in a Georgia county (or counties) with a population of 35,000 or less is required. More information can be found here.
For healthcare professionals who commit to working in medically underserved communities in public or non-profit institutions for a minimum of two years and a maximum of four years, the California State Loan Repayment Program will cover student loans up to $50,000.
The Educational Loan Repayment Program will offer to cover up to $18,000 in student loans for lawyers hired by the Office of the Attorney General as part of a recruitment and retention plan.