More than 500,000 people are eligible for student loan cancellation, but government has failed to act, group says


More than half a million student loan borrowers may be eligible for student debt forgiveness under federal law, but the US Department of Education has failed to act.

The National Student Legal Defense Network (NSLDN) obtained data as part of a Freedom of Information Act request indicating that the ministry has identified more than 517,000 borrowers eligible for cancellation of more than $ 8 billion. student loan dollars under the total and permanent disability discharge (TPD). program. The TPD Discharge program enables student loan borrowers who are unable to maintain substantial, gainful employment due to a medical, physical or psychological impairment to obtain full cancellation of their federal student loans.

However, to obtain a student loan discount under the TPD discharge program, student loan borrowers with disabilities must submit a formal application. The application process can be difficult, especially for borrowers who suffer from severe physical or psychological impairments that interfere with their ability to perform routine tasks. The Department of Education has the power to automatically grant a TPD discharge to disabled student loan borrowers who receive Social Security disability benefits, if they have a disability review period of at least five to seven years. The Social Security Administration has identified hundreds of thousands of disabled student loan borrowers who could benefit from relief under the program, and the agency shared this information with the Department of Education. But the ministry did not act. Many borrowers may not even realize that they qualify.

“The ministry has made the TPD discharge process unnecessarily cumbersome for borrowers with disabilities,” said Alex Elson, NSLDN vice president. “They know who these borrowers are, they know they are entitled to relief, and there is just no good reason they can’t provide it now.”

In April, student loan borrower advocacy organizations submitted an official petition to the education ministry to pressure the ministry to streamline TPD’s discharge program. The organizations included a letter urging the ministry to act.

“Ministry red tape is preventing hundreds of thousands of borrowers with disabilities from getting the help they are entitled to under the law,” read the letter from student, consumer and community advocates. People with Disabilities.

The Biden administration has taken action to address the issue with the TPD discharge program. Earlier this year, the administration announced it was easing bureaucratic requirements for TPD’s discharge program by temporarily waiving post-discharge monitoring periods during the COVID-19 pandemic. And last month, the Department of Education announced the start of a long negotiated rule-making process to review and potentially revise key federal student loan programs, including the TPD release program, as well as other programs such as income-based repayment and forgiveness of public service loans. .

Meanwhile, the administration is conducting a legal review to determine if Biden has the power to go further and write off student loan debt on a large scale using executive action. The results of this review could be published in the coming months.

Further reading

Biden administration announces major overhaul of income-based repayment and student loan forgiveness programs

Will Biden cancel student loan debt? We may know soon

Biden Student Loan Forgiveness Review: Should You Take Action Now to Write Off Student Debt Later?

If Biden doesn’t cancel student loan debt, could he do it instead?

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