For some time now, disabled Americans who were saddled with hefty federal student loans remained eligible for loan forgiveness under the Total and Permanent Disability (“TPD”) Discharge program. Unfortunately, many disabled borrowers were unaware of the debt forgiveness program and have never sought assistance. Fortunately, the Department of Education has just announced that it plans to prospectively identify borrowers who are eligible for debt forgiveness, which could be a huge relief for thousands of disabled Americans.
Working in coordination with the Social Security Administration, the Department of Education has sought to identify student loan borrowers who receive disability payments and are designated as “Medical Improvement Not Expected,” a term that would qualify them for loan forgiveness under the TPD program. According to the Department of Education, in December of 2015 and March of 2016, approximately 387,000 borrowers were identified as being eligible for debt forgiveness under TPD. The Department estimated that this constitutes over $7.7 billion worth of student loan debts that might be eligible for forgiveness.
Starting on April 18, 2016, The Department of Education is seeking to reduce this number by sending customized letters to eligible disabled borrowers with instructions on how to obtain a discharge under the TPD program. This will also apparently include a streamlined process to sign and complete an application with relatively little inconvenience.
This could have tremendous consequences for disabled Americans who owe federal student loans. Historically, disabled Americans who received Social Security disability benefits could have their benefits reduced or offset in an effort to collect on student loans that were in default. Tragically, some of the very people who were eligible for debt forgiveness ended up losing some of their Social Security benefits for the simple reason that they were unaware of the TPD program. Now, the Department of Education’s proactive measures should help to prevent this tragic result from happening in the future.
If you are disabled and have questions about possible loan forgiveness or would otherwise like to talk to a Social Security disability attorney, call us today. Also, feel free to visit www.disabilitydischarge.com for more information about the TPD program and to see whether you qualify for student loan forgiveness.