Loan Repayment

Those beginning a MIDOCs residency in academic year 2025 may receive up to $150,000 for the repayment of qualifying loans.

QUALIFYING LOANS

A MIDOCs participant will receive loan repayment funding to be applied to the principal, interest, and related expenses of outstanding Government (Federal, State, or local) and commercial (i.e., private) student loans for undergraduate or graduate education obtained by the participant for school tuition, other reasonable educational expenses, and reasonable living expenses. The educational loans must be obtained prior to beginning a MIDOCs residency.

Consolidated or refinanced loans may be considered for repayment, so long as they are from a US Government (Federal, State, or local) or private student loan lender and include only qualifying educational loans of the applicant. If an otherwise eligible educational loan is consolidated or refinanced with ineligible (non-qualifying) debt of the applicant, no portion of the consolidated or refinanced loan will be eligible for loan repayment. For loans to remain eligible, applicants and/or participants must keep their eligible educational loans segregated from all other debts. Eligible educational loans consolidated with loans owed by any other person, such as a spouse or child, are ineligible for repayment.

Loans that do not qualify for loan repayment include, but are not limited to:

Loans for which the applicant incurred a service obligation.
Loans for which the associated documentation cannot identify that the loan was solely applicable to the undergraduate or graduate education of the applicant.
Loans not obtained from a US Government entity or private student loan lending institution. Most loans made by private foundations to individuals are not eligible for repayment.
Loans that have been repaid in full.
Parent PLUS Loans (loans made to parents).
Personal lines of credit.
Loans subject to cancellation.
Residency loans.
Credit Card debt.

NOTE: Documentation of loans will be required. Qualifying educational loans must have documentation to establish that they were contemporaneous with the education received. Loan documentation will be verified by contacting lenders/holders and possibly reviewing the applicant’s credit report. You must submit loan documentation to the program director prior to, or within 18 months of, completing residency.

Distribution of Funds
The student loan payments are made directly to the resident so that you have the ability to apply it to your loans in the way that is most advantageous to your financial situation. The money may be applied to your loan(s) as a lump sum or used for monthly payments. The loan repayment award is disbursed in 3 installments:
• The first is paid when you present a signed employment contract
• The second when you start your job
• The third at the completion of one year of employment

The job must meet the practice requirements as outlined by MIDOCs and be in an underserved area of Michigan. The total loan award cannot exceed the outstanding balance of your qualified loans (e.g. If the total outstanding balance of your qualifying loans is $115,000 you would receive a total of $115,000 in loan repayment).

Tax Treatment of MIDOCs Payments
MIDOCs loan repayment funds are exempt from gross income, employment, state, and local taxes. Generally, loan reimbursement awards received under a State loan repayment or loan forgiveness program that is intended to provide for the increased availability of health care services in underserved or health professional shortage areas are excluded from wages for FICA, FUTA, and federal income tax withholding purposes. For tax purposes, you may want to keep receipts showing that the money was applied to your loans; you may want to consult your tax adviser on this.

For common questions and answers about loan repayment, visit our FAQs.

See the full MIDOCs Loan Policy here.