It was a book I read many years ago. It focused around a young shepherd girl who comes back to her village to find everyone dead by plague. She has innate magic ability which she then uses to basically melt the village to the ground. Other magic users feel the surge of power from miles away and take her to a city based around magic academies, one for males and one for females. There is more to the story such as cats with thumbs, magical otters who are actually cursed magicians, flying horses created by magic, and of course a love interest. I have been trying to find this book and author for years and any help would be appreciated.
That would be Fire in the Mist by Holly Lisle; it's the first in the Arhel trilogy.
Sample chapters on the author's web-site here, as well as e-book versions of all three books available for purchase.