For many disabled individuals in New York City, student loans are a nightmare. Account balances continue to grow, go into default, and loom over you as a reminder of another dream having a disability has squashed. When you are struggling just to take care of yourself, paying off a loan is unrealistic.
The Biden Administration is taking action to relieve disabled individuals of this burden. This fall the U.S. Department of Education announced it is trying to make it easier for disabled individuals to have their student loans discharged under an existing but underutilized program that provides student loan relief to disabled individuals.
The Department of Education is going to match the data it has on loan holders with data from the Social Security Administration (SSA) on individuals who have a total and permanent disability (TPD). When someone is on both lists, the Department of Education is going to take steps to get these borrowers automatic student loan relief. There will be no need for the borrower to fill out additional paperwork.
“Today’s action removes a major barrier that prevented far too many borrowers with disabilities from receiving the total and permanent disability discharges they are entitled to under the law,” said U.S. Secretary of Education Miguel Cardona. “From day one, I’ve stressed that the Department of Education is a service agency. We serve students, educators, and families across the country to ensure that educational opportunity is available to all. We’ve heard loud and clear from borrowers with disabilities and advocates about the need for this change and we are excited to follow through on it. This change reduces red tape with the aim of making processes as simple as possible for borrowers who need support.”
The Department of Education is also taking steps to prevent borrowers from having their loans reinstated because they fail to fill out paperwork confirming their income every few years. Like many disability benefits, loan forgiveness is unavailable to disabled individuals making over a certain amount. A 2016 report from the Government Accountability Office found that many disabled individuals were losing their eligibility for student loan forgiveness because they failed to fill out income verification paperwork every few years, not because they were actually earning more than the program allows. Changing the law so this paperwork is no longer required will help many people.
It is estimated that over 323,000 borrowers who have a total and permanent disability will receive more than $5.8 billion in automatic student loan discharges because of these changes.
Seelig Law Offices is proud of the work we do to help disabled individuals in New York City qualify for Social Security Disability benefits, and other benefits that use the SSA’s determination as a reference point. Seeing our clients get the financial help they need to improve their lives is important to us. If you have questions about student loan forgiveness or other benefits you may be eligible for because of your disability, please contact Seelig Law Offices’s experienced team of New York City-based disability benefit attorneys for a free consultation.