Tuesday, May 6, 2014

Found Disabled, It May Discharge Your Student Loan!!



If you have a federal student loan, you may be eligible to have the loan cancelled through a “total and permanent disability” discharge.  With some exceptions, noted below, a discharge could mean you will not have to repay the student loan.

Federal student loans eligible for discharge include William D. Ford Federal Direct Loan Program loans, Federal Family Education Loan (FFEL) program loans, Federal Perkins Loans or Education Assistance for College and Higher Education (TEACH) grant service grant obligations.  If you have a loan through another loan programs or a private loan, check with the loan issuer since each program may have its own discharge rules. 

The Eligibility requirements, to have a loan discharged, are more restrictive than merely having social security find you disabled, and more difficult to meet.  To be eligible you must be unable to do any ‘substantial gainful activity’ (work involving significant physical and or mental activities) because of a medically determinable physical or mental impairment that has lasted 60 months, can be expected to last for 60 months, is expected to result in death, or is due to a 100% military service connected disability.

To attempt to gain the benefit of the program you must apply for a discharge http://disabilitydischarge.com/Pages?Users.aspx?id=35 and meet their qualifications.  You submit the application to your loan servicer, you must submit an application for each loan holder.  To find out who your loan servicer is, see http://www.nolo.com/legal-encyclopedia/who-is-my-student-loan-holder.html.

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