A borrower may qualify for Total and Permanent Student Loan Disability Discharge on their Federal Student Loans if they are unable to engage in any substantial gainful activity because of physical or mental impairment. This physical or mental impairment must:
- Have lasted for 60 consecutive months, or
- Can be expected to last 60 consecutive months, or
- Can be expected to result in death.
If your disability fits the above criteria, you may be eligible for Total and Permanent Student Loan Disability Discharge on your Federal Student Loans.
The first step in the process would be to determine if Student Debt Relief should consolidate your loans into the Student Loan Forgiveness Act. There are a few reasons this may be worthwhile to do.
- May qualify for a zero payment regardless if loans are discharged or not with an income based repayment
- May be easier to discharge one consolidated loan -versus- ten loans with different servicers
- Is a good backup plan in case the discharge is not approved as the borrower will be in the forgiveness program.
Once the loans are consolidated, the borrower must have his or her physician certify that the borrower does in fact fit the above criteria and can be considered Permanently Disabled. The application must be submitted within 90 days of the physician’s certification.
Total and Permanent Student Loan Disability Discharge
When the application is submitted, the loan holder would then review the application and make a determination if you qualify for the Total and Permanent Disability Discharge. If the loan holders determine that you do not qualify, then you must continue to make payments on your loans. If you do qualify, then your loans would be discharged and you would no longer be responsible for making any payments.
After the discharge of the loans, the borrower would be subject to 3-year post-discharge monitoring. During this monitoring period, the borrower must not have a job that provides a level income above the poverty guidelines for a family of two. It does not matter if your actual family size is more than 2. The borrowers, during the monitoring phase, must not receive any news of Direct Loans, Perkins, or TEACH Grants.
It is also the responsibility of the borrower to report any annual salary that surpasses the federal poverty guidelines for a family size of two. If your annual salary surpasses the federal poverty level for a family size of two, you may be subject to having your federal student loans reinstated in which case you will be responsible for making payments on them.