Student Loan Discharge Program Questioned

Empire Justice Center January 31, 2020

Social Security Disability and SSI beneficiaries who have been found permanently disabled may be eligible for discharge of their federal student loans.  But advocates who have tried to assist clients with discharges have undoubtedly seen some of the hurdles these beneficiaries face, not the least of which may be proving their disabilities are total and permanent. [See the June 2016 edition of this newsletter for tips on how to help, including ways of determining if the beneficiary’s disability finding was classified as Medical Improvement Not Expected.]


A recent NPR report underscored these and other hurdles beneficiaries confront.  It emphasized the extent to which the Department of Education has failed to help potentially eligible borrowers get the relief to which they are entitled.  Many borrowers are either unaware of the program or have difficulty navigating the bureaucracy because of their disabilities.


The day after the NPR report was aired, lawmakers called for an investigation into the troubled student loan discharge program.  A bipartisan Congressional group has asked the Department of Education for data about the numbers of individuals identified by SSA or the Veterans Administration as eligible who have actually received a loan discharge.  In its letter to the Department of Education, the group expressed its concern over the Department’s lack of transparency with Congress, citing the differences between the low rates of discharges reported by NPR compared to data previously shared with Congress.  A copy of the Congressional letter is available here.