The latest student debt statistics indicate how serious the student loan crisis has become for borrowers across all demographics and age groups. Among 45 million debtors in the U.S., collective debt has reached a record $1.6 trillion according to a Bloomberg analysis. These numbers aren’t surprising considering that the average tuition for the 2019–2020 academic year for a four-year in-state public college averaged $26,590. Loan debt is now the second-highest consumer debt category—behind only mortgage debt—and higher than both credit cards and auto loans.
Fortunately, if you qualify under certain categories, your loan debt can be excused. If you’re a student loan borrower who can’t work because of a long-term disability, you may be entitled to student loan forgiveness through your original lender for your private loans, or, if not, through student loan settlement with a law firm like McCarthy Law.
Student Loan Forgiveness Programs Available for Those with a Total and Permanent Disability
If you’re a student loan borrower facing long-term disability and struggling under a mountain of debt, there are a few programs you can consider, including the following:
Total and Permanent Disability (TPD) Discharge
For federal student loan borrowers facing long-term disability, you may be eligible for student loan forgiveness through total and permanent disability discharge. This program relieves you from having to repay a William D. Ford Federal Direct Loan, a Federal Family Education Loan, and a Federal Perkins Loan to complete a TEACH Grant service obligation. Note that this program only applies to those with federal loans.
To be eligible, you’ll first have to demonstrate that you’re totally and permanently disabled. You can do so in one of the following ways:
- If you’re a veteran: Submit documentation from the Department of Veterans Affairs showing that you’re unemployable due to a service-connected disability
- If you’re receiving federal benefits: Submit a Social Security Administration notice showing that you’re receiving disability insurance or Supplemental Security Income and that your next scheduled disability review will be within five to seven years
- If you’re otherwise disabled: Submit certification from a physician proving that you’re totally and permanently disabled, meaning that you suffer a physical or mental impairment that’s lasted continuously for at least five years or could result in death
If it’s determined that you’re totally and permanently disabled based on your documentation, you’ll be notified that your loan obligations have been discharged and that you’ll receive a refund for any loan payments received after the date the documentation was obtained.
Private Student Loan Forgiveness Due to Disability Through Your Lender
If you borrowed from a bank, credit union, or another private lender, your access to loan forgiveness, even in cases of disability, is likely more limited. However, some lenders will forgive your remaining balance in the case of a disability or death. If your lender offers this option, be prepared to provide documentation of your disability.
How Do You Know Whether You Have a Federal or Private Loan?
In order to understand your options, you must first consider whether you have federal or private loans. Private student loans are made by private lenders such as banks or credit unions. Federal student loans, on the other hand, are funded by the U.S. Department of Education.
To check whether or not you have a federal or private loan, first determine whether it’s been issued by the federal government. To get a list of your federal student loans, go to the National Student Loan Data Services website maintained by the U.S. Department of Education. If your particular student loan isn’t listed there, it’s most likely a private student loan. A qualified student debt lawyer can also help you understand what kind of loans you have if you’re still unsure.
For those with federal loans, you can have your federal student loans forgiven, canceled, or discharged under certain circumstances. Learn more about the types of forgiveness options and whether you qualify due to your job or other circumstances online. For those with private loans, look no further than the student loan experts at McCarthy Law.
The Student Loan Attorneys at McCarthy Law Can Help
If you have a private student loan, the attorneys at McCarthy Law can help. Under our student loan debt settlement program, an experienced attorney contacts your student loan lenders and begins a negotiation process to significantly reduce the balance on your private loans. At the end of a successful student loan settlement, you’ll end up paying only a fraction of the original balance claimed by the lender. The rest of the debt is forgiven by the lender and the settlement is a full and final settlement of the debt, leaving you without the burden of student loan debt going forward.
Start by giving our offices a call and telling us about your unique situation during a free phone consultation. One of our Engagement Team Members will thoroughly review your case. Once we have a full understanding of your case, we can give you the best possible options.
Contact a Skilled Student Loan Lawyer at McCarthy Law
Student loan forgiveness may seem too good to be true—especially for those with private loans—but there are legitimate ways to reduce your student debt if you have the right student loan lawyer by your side. That’s where the attorneys at McCarthy Law come in. If you’re someone who has a permanent disability or is overwhelmed with student loan payments, consider reaching out to our attorneys who help you explore the best options for getting on top of your finances. A skilled student debt lawyer can provide you with practical legal advice after fully analyzing your situation and determining the most strategic method that will have you feeling financially reassured.
The lawyers at McCarthy Law understand the stress of student debt, especially for individuals with disabilities burdened with private loan debt. We are dedicated to fighting for your financial freedom. To schedule a free consultation with a knowledgeable and experienced debt settlement professional, call (855) 976-5777 or fill out our contact form today.
Frequently Asked Questions About Student Loan Forgiveness
What kinds of public service jobs will qualify me for loan forgiveness under the PSLF Program?
If you’re employed by a United States federal, state, local, or tribal government or by a not-for-profit organization, you might be eligible for the Public Service Loan Forgiveness (PSLF) Program. For example, if you work as a public-school teacher, registered nurse, or Peace Corps volunteer, you may qualify for loan forgiveness. Your specific job does not determine eligible employment for the PSLF Program. Instead, it’s determined by who your employer is.
Do I need to be a full-time employee to qualify for PLSF?
To qualify for PSLF, you must work full-time for the agency or organization with the U.S. federal, state, local, or tribal government or not-for-profit organization. To be considered full-time, you must work at least 30 hours per week or meet your employer’s definition of full-time, whichever is greater.
What happens if I lose or quit my job?
When a borrower quits their job, is fired, or has an employment gap, prior qualifying PSLF payments are not removed and they do not re-start the approval process. Returning to qualifying employment and repayment will enable borrowers to resume payments in order to fully make 120 qualifying payments.
What types of loans qualify for the PLSF Program?
All loans borrowed under the William D. Ford Direct Loan Program (Direct Loan) are eligible for PLSF. PSLF does not cover loans you received through the Federal Perkins Loan Program or the Federal Family Education Loan Program, but may be eligible if you consolidate them into a Direct Consolidation Loan. Loans from private lenders do not qualify.
What is TPD discharge?
A total and permanent disability (TPD) discharge eliminates all federal student loan liability and TEACH Grant service obligations. Student loan borrowers who cannot work due to a physical or mental impairment may be eligible for a total and permanent disability discharge.
How must I prove that I am totally and permanently disabled in order to qualify for permanent disability loan forgiveness?
For a borrower to be awarded forgiveness, they must demonstrate that they are physically or mentally incapable of working. To do this, borrowers can obtain applicable supporting documentation from the U.S. Department of Veteran Affairs (VA), the Social Security Administration (SSA), or a physician certification.
How do I start the process for applying for a TPD discharge?
To apply for a TPD discharge, you can start it online, download a blank application or print a partially complete one, or request a TPD discharge application by phone or email. Learn more about your options, and how to apply.