Here’s how to qualify for $7 billion of student loan forgiveness if you have a disability.
Here’s what you need to know — and what it means for your student loans.
President Joe Biden has canceled more than $17 billion of student loans. (Biden still considering wide-scale student loan cancellation). This includes a new announcement that $7 billion of student loans has now been canceled for 350,000 student loan borrowers with a total and permanent disability. Here’s how you can qualify.
How to get this student loan forgiveness
Beginning during the Obama administration, student loan borrowers with a total and permanent disability could get student loan cancellation through a discharge. However, the biggest hurdle for most student loan borrowers was completing burdensome paperwork. Since becoming president, Biden has been reforming student loan relief. This has included removing administrative roadblocks so that student loan borrowers can access student loan forgiveness more easily. (Biden dropped student loan cancellation from his annual budget). For example, during the Covid-19 pandemic, U.S. Secretary of Education Miguel Cardona waived the requirement to submit proof of income. Previously, student loan borrowers had to demonstrate that their income didn’t exceed the poverty line for a three-year monitoring period. The U.S. Department of Education has committed to working with the U.S. Social Security Administration and the U.S. Department of Veterans Affairs to use data-matching to identify student loan borrowers automatically who qualify for student loan relief. This will help streamline the process of helping student loan borrowers to access student loan forgiveness. (Student loan cancellation may look different than you think).
How to apply for student loan forgiveness for a total and permanent disability discharge
There are three ways to qualify for a total and permanent disability discharge:
- Veterans: you have a service-connected disability that is 100% disabling or you are disabled based on an individual unemployability rating.
- Social Security Disability: you receive Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) benefits.
- Doctor’s certification: A medical doctor can certify that you can’t engage in any “substantial gainful activity” due to a medically determinable physical or mental impairment that can be expected to result in death, has lasted for a continuous period of not less than 60 months, or can be expected to last for a continuous period of not less than 60 months. (Student loan cancellation and the student loan payment pause are confusing. Here’s what to know).
To apply for student loan forgiveness, submit an application and any supporting documentation of your total and permanent disability. If the Education Department contacts you directly based on information received from the Social Security Administration or U.S. Department of Veterans Affairs, then you’re not required to provide supporting documentation showing that you’re totally and permanently disabled. Currently, federal student loan payments are paused through August 31, 2022. However, once student loan payments restart, you won’t have to pay federal student loans while your application for student loan forgiveness is reviewed. (Here’s who won’t qualify for $6.2 billion of student loan cancellation).
If you don’t qualify for this student loan forgiveness, don’t panic. There are many opportunities for student loan repayment. Here are some of the most popular ways to save money:
- Student loan refinancing (lower interest rate + lower payment)
- Income-driven repayment (lower payment)
- Student loan forgiveness (federal student loans)
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