What Is the Process for Discharging Student Loans?


Quick Answer

Student loan borrowers who are eligible for discharge, forgiveness or cancellation of their loans must submit documentation of their qualifying statuses to their loan servicers or the U.S. Department of Education, according to Federal Student Aid. Teachers and public service workers may be eligible as well as individuals with permanent disabilities. The lender must also discharge the loan in other circumstances, such as the borrower’s school closing or the borrower’s death.

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Full Answer

Borrowers who can prove they are permanently disabled and cannot work are eligible for discharge of all student loans, states Federal Student Aid. Disabled veterans can submit verification from the U.S. Department of Veterans Affairs. Individuals receiving Social Security disability benefits can submit the Social Security Administration notice of award, which grants disability benefits for a recurring five-to-seven-year period. Otherwise, the borrower must submit a physician’s evaluation. All disabled borrowers must submit this documentation to the U.S. Department of Education for a review of eligibility.

As of 2015, teachers are eligible for forgiveness of up to $17,500 of their loans after working five consecutive years, explains Federal Student Aid. Those who work in public service positions, such as for qualifying not-for-profit organizations and government organizations, may be eligible for loan forgiveness after making 120 payments. Forms to apply for these debt forgiveness programs are available at the Federal Student Aid website.

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