​A key student loan forgiveness program has been suspended: what to do next? 

04/01/2025
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06:34
CSTAmericans will have received the bad news that the Department of Education has closed applications for student loan forgiveness based on severe medical impairments, after over half a million applied to the program. So what do you do now?The suspension of the scheme comes as part of an aim from President Joe Biden’s departing government to make the federal student loans process smoother, but the real world impact is jeopardy for borrowers.The Total and Permanent Disability Discharge program (TPDD) aimed to allow borrowers to wipe out their debt based on medical injury or ailment, provided it ensured they could not engage in substantial, gainful activity for the last five, or next five, years.Changes to the TPDD from the Biden Administration aimed to make it easier for applications to apply, qualify and be approved for the loan forgiveness, but now the future of the endeavor is uncertain.”We will be transitioning Total and Permanent Disability (TPD) discharges to ED through StudentAid.gov,” explains the Department of Education. “Previously, TPD discharges were managed by a designated servicer. “To meet this goal, there will be a pause in processing TPD discharges beginning Dec. 20, 2024, as we update and streamline our systems for a better user experience.”The good news is the scheme, that has had over $16bn investment, is paused instead of cancelled, and the Department of Education are still accepting applications. However, the applications are not expected to be completed until Spring 2025 so there could be a waiting period to be accepted.Fortunately, loaners can request payments to be stopped for 120 days by informing Nelnet of intent to apply to the TPDD.To qualify for the program, provide proof of your disability through confirmation by the U.S. Department of Veterans Affairs or through Social Security Administration programs such as Social Security disability benefits.A qualified medical professional can also confirm if an applicant meets the qualifying criteria for the TPDD program.