If you are interested in applying for Social Security Disability benefits, it is likely that you are not capable of working and therefore are living off of limited income. In circumstances such as these, it can be difficult to find the money each month to pay for things like rent, heat, electricity, water, and—in some cases—student loans.
Fortunately, if you are receiving disability benefits and are responsible for paying back student loans, you may be eligible for student loan forgiveness. We address this topic in the following blog post as a response to this question:
“If I am approved for disability benefits, will my student loans be forgiven?”
The one-word answer to this question is maybe. Being approved for disability benefits by the Social Security Administration (SSA) can be an important first step toward student loan forgiveness, however, it is not an automatic guarantee. To have your loans forgiven you must qualify for something called Total and Permanent Disability (TPD) discharge.
TPD is monitored by Federal Student Aid, an office of the U.S. Department of Education. TPD discharge means that you no longer have to pay back any of the money you owe for school. There are three main types of loans covered by this program:
- William D. Ford Federal Direct Loan
- Federal Family Education Loan
- Federal Perkins Loan
TPD discharge also relieves you from completing a TEACH Grant obligation—if applicable.
Do You Qualify for TPD?
You will be approved for TPD if you can prove that you have a long-term disability. The Department of Education accepts the following as proof of permanent disability:
- Documentation from the U.S Department of Veteran’s Affairs showing that you are unemployable due to a service related disability.
- Documentation from the Social Security Administration (SSA) proving that you receive disability benefits and that your next disability review is scheduled to be held with 5 to 7 years from your latest review.
- Documentation from your physician that shows you have a condition that can be expected to result in death, has lasted for a continuous period of at least 60 months, or can be expected to last for a continuous period of at least 60 months.
In all three of these instances, the Department of Education will require certain documentation to support your claim.
How to Apply
To start your application, you should let the Federal Student Aid office know that you are interested in receiving TPD discharge. A simple way to do this is to begin your application online. Once the office is aware that you are applying for loan forgiveness, your loans will be put on hold for up to 120 days, allowing you time to complete the paperwork without having to worry about making payments.
The Next Step
After you have successfully submitted your TPD discharge application it will take around 30 days to receive a decision. You will be notified regardless of whether or not you are approved. If you are not approved for TPD discharge, payment for your loans will resume as usual and you will be allowed to appeal the decision made on your application.
If you are approved, the Department of Education will monitor your case for three years. During this ‘monitoring period’ the Department will review your circumstances to make sure that you fit the appropriate qualifications to continue to have your loans forgiven.