More than half a million student loan borrowers may be eligible for cancellation of their student debt under federal law, but the US Department of Education took no action.
The National Student Legal Defense Network (NSLDN) received the data at the request of the Freedom of Information Act, according to which the Department identified more than 517,000 borrowers who are eligible to cancel over $ 8 billion in student loans under the Freedom of Information Act. Complete and Permanent Disability Statement (TPD) program. The TPD Discharge program allows student loan borrowers who are unable to maintain significant, paid employment due to physical or mental illness to completely forgive their federal student loans.
However, to be forgiven for a student loan under the TPD Discharge program, student loan borrowers with disabilities must submit a formal application. The application process can be challenging, especially for borrowers with severe physical or psychological disabilities that prevent them from coping with routine tasks. The Department of Education has the authority to automatically provide a TPD statement to borrowers of student loans with disabilities who receive Social Security disability benefits if they have a disability verification period of at least five to seven years. The Social Security Administration has identified hundreds of thousands of student loan borrowers with disabilities who could qualify for assistance under the program, and the agency has shared this information with the Ministry of Education. But the department did not act. Many borrowers may not even realize that they are eligible.
“The department has made the TPD repayment process unnecessarily burdensome for borrowers with disabilities,” said Alex Elson, vice president of NSLDN. “They know who these borrowers are, they know they are eligible for help, and there is simply no good reason why they cannot provide it now.”
In April, student loan advocacy organizations filed a formal rule-making petition with the Department of Education to pressure the Department to streamline the TPD discharge program. The organizations have attached a letter urging the Ministry to act.
“The bureaucracy of the Department prevents hundreds of thousands of borrowers with disabilities from getting the assistance they are entitled to by law,” reads a letter from students, consumers and disability rights advocates.
The Biden administration has taken some steps to address the problematic TPD unloading program. Earlier this year, the administration announced that it was relaxation of bureaucratic requirements for the TPD unloading program by temporarily withdrawing from post-discharge monitoring periods during the COVID-19 pandemic. And last month, the Ministry of Education announced the start of a lengthy, agreed rule-making process to review and possibly overhaul major federal student loan programs, including the TPD discharge program, and other programs such as income-based payments and government service loan forgiveness.
Meanwhile, the administration is conducting legal due diligence to determine whether Biden has the authority to go further and write off student loan debt on a massive scale using enforcement action. Results of this review may be released in the coming months…