Can Social Disability Help You Discharge A Student Loan?

If you are unable to work due to illness or injury and are in the process of applying for Social Security Disability, you may also be eligible for student loan forgiveness, known as a "discharge." If you meet the guidelines for SSDI, you may also meet the guidelines for federal loan discharge. Acceptance in one program, however, doesn't guarantee loan forgiveness. To see if you could qualify for this program, read on.

Total And Permanent Disability Discharge

The TPD discharge program gives people who are unable to work the option to have their student loans forgiven through a discharge if the loan was through any of the following programs:

  • William D. Ford Federal Direct Loan Program
  • Federal Family Education Loan (FFEL)
  • Federal Perkins Loans
  • Teacher Education Assistance for College and Higher Education (TEACH) Grant Service

How To Qualify For TPD

The TPD discharge program has more stringent medical requirements than the SSA. Most notably, you must be unable to work for 60 months (5 years) or longer, compared to the SSA's requirement that your inability to work must last only one year or longer. However, if the Social Security Administration approves your disability claim and considers you to be in a class known as "Medical Improvement Not Expected (MINE)," you will likely qualify for the TPD program. Essentially, by putting you in that status, SSA is verifying that your inability to work is expected to last at least 5 years.

The other two ways to qualify for the TPD program is with a service-connected disability statement from the Veteran's Administration or with a statement from a doctor stating either:

  • You are permanently and totally disabled and unable to do any work.
  • Your disability has lasted for at least 60 months or is expected to last for at least 60 months.

Keep in Mind

1.  You must submit a separate application for each loan.

2.  Your income will be monitored for a period of time to ensure that you are not engaging in any substantial gainful work activity.

3.  It will be extremely difficult to obtain a new student loan.

4.  If you are interested in applying for a TPD, you can get more information and apply here.

5.  Once you have contacted Disability Discharge, any collection activity on your student loans will be suspended for 120 days, allowing you time to submit the needed paperwork. Failure to submit your paperwork by the end of the 120 days will result in the resumption of collection activities.

If you are having trouble getting your Social Security Disability approved and it is holding up the discharge of your student loans, consider consulting with a Social Security disability lawyer for assistance.