Physical Therapy School Costs an Arm & a Leg: Here’s How to Repay It

Kat Tretina

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Before You Read, Lower Your Student Payment

It’s that quick & easy — really. Our free tool checks a network of top refinance lenders and shows you options in one easy chart.

Checking rates takes 2 minutes with no impact on your credit
Federal & private loans are eligible
No maximum loan amount

As highly trained professionals, physical therapists can command high salaries. The U.S. Bureau of Labor Statistics reported that the median salary for physical therapists was $89,440 as of 2019. That’s far higher than the median annual wage for all workers, which was just $39,810.

Even better, the demand for trained physical therapists is growing. The industry is expected to grow by 22 percent by 2028, much faster than the national average for all occupations.

Becoming a physical therapist can be a rewarding career, and you’ll likely enjoy job security, too. However, becoming a physical therapist can be expensive.

If you have a large student loan balance and want to learn how to pay off your physical therapy loans, here’s what you need to know.

The high cost of physical therapy school

While physical therapists have a high earning potential, their careers require a significant amount of education. Before you can start work, you’ll likely need a doctoral or professional degree.

To pay for your schooling, you’ll likely rack up substantial student loan debt.

According to the American Physical Therapy Association, physical therapy graduates leave school with more than $83,000 in student loan debt, on average. Worse, loans for graduate and professional degrees tend to have higher interest rates than other loans. For loans disbursed between July 1, 2019, and July 1, 2020, the following rates apply on federal student loans:

  • Grad PLUS Loans: 7.08%
  • Direct Unsubsidized: 6.08%

With such high rates, interest can rapidly accrue, causing your student loan balance to grow. Over time, you could have to repay thousands more than you originally borrowed.

Refinancing PT school loans

As a physical therapist, student loan refinancing can be a smart strategy for tackling your high-interest student loan debt.

When you refinance your loans, you apply for a loan from a private lender for the amount of your existing education debt, including your current federal and private student loans. Using the loan to pay off the old debt, you will then have just one loan and one loan monthly payment to remember going forward instead of several.

With student loan refinancing, your new loan will have entirely different terms than your old debt. You’ll have a new interest rate, length of repayment, and monthly payment.

3 benefits of student loan refinancing

For physical therapists, student loan refinancing has several benefits.

1. You can save money

Because you likely had to take on so much high-interest student loan debt to pay for school, you’re a prime candidate for student loan refinancing. And, by refinancing your loans, you could qualify for a lower interest rate, helping you save money over the life of your loan.

For example, let’s say you had $83,000 in Grad PLUS Loans at 7.08% interest. With a 10-year repayment term, your monthly payment would be $967 per month. After making 120 monthly payments, you would repay a total of $116,055 — interest charges would cost you over $33,000.

But if you refinanced your loans and qualified for a 10-year loan at just 4.5% interest, the results are quite different.

Your monthly payment would drop to $860 — a savings of $107 per month — yet you’d pay just $103,244 over the life of your loan. By refinancing your education debt, you’d save nearly $13,000.

 Original Loan at 7.08%Refinanced Loan at 4.5%
Loan Amount$83,000$83,000
Loan Term10 Years10 Years
Monthly Payment$967$860
Total Interest Paid$33,055$20,244
Total Repaid$116,055$103,244

2. You can reduce your monthly payment

With student loan refinancing, you can qualify for a lower interest rate, which can reduce your monthly payment. But, you can also opt for a longer loan term. Instead of a 10-year term, you can choose a loan term of 15 or even 20 years. With a longer loan term, you’ll pay more in interest over time, but you can significantly reduce your monthly payment and get more breathing room in your budget.

3. You can simplify your payments

To pay for school, you likely had to take out several different loans from several different lenders. You may have a mix of both federal and private loans, making it difficult to keep track of loan servicers, interest rates, monthly payments, and payment due dates.

When you refinance your loans, your debt is consolidated into one loan. After refinancing, you have just one loan servicer and one monthly payment, making it easier to manage your loans.

Alternative loan repayment options for physical therapists

While refinancing can be an effective strategy for managing your student loans, it’s not for everyone. If you don’t think it’s a good fit for you, consider these alternatives.

1. Enroll in an income-driven repayment plan

Can’t afford your loan payments? If you have federal loans, you may be eligible for an income-driven repayment (IDR) plan. With an IDR plan, your loan term is extended, and your monthly payment is based off of your discretionary income and family size. Depending on your situation, you could see a drastic reduction in your payments.

Apply for an IDR plan online or contact your loan servicer.

2. Apply for loan forgiveness

If you’re a physical therapist in a non-profit hospital, veteran’s facility, or other non-profit organization, you may be eligible for loan forgiveness through Public Service Loan Forgiveness (PSLF). Under PSLF, borrowers can qualify for loan forgiveness if they work full-time for an eligible employer for ten years while making 120 qualifying monthly payments. Payments made under an IDR plan count toward the 120 necessary payments, even if they’re very low.

You can use the PSLF Help tool to find out if your student loans and employment are eligible for loan forgiveness.

3. Consolidate your federal student loans

If you have several different federal loans, you can simplify your payments by consolidating them with a Direct Consolidation Loan. With this approach, they remain federal loans, so you can still take advantage of federal benefits like IDR plans and PSLF.

However, Direct Consolidation usually won’t help you save money like student loan refinancing can. And, because you can choose a loan term as long as 30 years, you could pay more in interest over time.

You can apply for a Direct Consolidation Loan online.

4. Pursue federal loan repayment assistance

There are federal loan repayment assistance programs physical therapists can take advantage of to get help with their education debt.

  • Indian Health Service Loan Repayment Program: If you make a two-year service commitment to work in a health facility servicing American Indian or Alaska Native communities, you could receive up to $40,000 in loan assistance through the Indian Health Service Loan Repayment Program.
  • Faculty Loan Repayment Program: If you are willing to work as a faculty member at a health professions school, you could receive up to $40,000 in loan repayment assistance through the Faculty Loan Repayment Program.

5. Research state loan repayment assistance programs

Some states offer their own loan repayment assistance programs to recruit healthcare professionals, including physical therapists.

For example, Alaska operates the SHARP program. Healthcare professionals can receive between $20,000 and $47,000, depending on their specialty, in loan repayment assistance, in exchange for a two-year contract.

Check with your state’s Department of Education or Health & Human Services to see if your area has a similar program.

How to pay off physical therapy loans

Physical therapy is a rewarding career. While getting the necessary education is expensive and likely requires student loans, there are multiple repayment options available to make your debt more manageable.

If you’re interested in refinancing your loans, use Purefy’s Compare Rates tool to see your rate options — quickly and conveniently — from top student loan refinancing lenders.

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