Department of Education Restores Disabled Student Debt Relief for Selected Borrowers: NPR


The US Department of Education today announced it will provide student debt relief to more than 40,000 borrowers. These are borrowers who can no longer work because they have significant and permanent disabilities. The change is a first step towards solving a struggling program that NPR’s Cory Turner and Clare Lombardo investigated over a year ago. Cory Turner joins us now with more details on today’s development.



CHANG: Hey. So what is the education department promising to do here?

TURNER: So federal law has long said that the Department of Education can write off federal student loans from any borrower with a significant disability. They just have to ask. It is not automatic. Then they have to do three years of income tracking, submitting documents once a year. The thing is, income monitoring really trips a lot of people. In fact, the ministry revealed today, Ailsa, that just last year – in fact, during this pandemic – 41,000 borrowers saw their debts returned to them, reinstated …


TURNER: … Because they failed this income monitoring requirement. And to be clear, most fail because they are making too much money. They just don’t send the documents correctly or at all. So what the department said today was that it was going to give those 41,000 borrowers an alternative. They’re going to write off their debts again and then give them a chance to survive through this three-year income watch.

CHANG: Wait. Now why is this income paperwork such a hurdle?

TURNER: Yeah, it’s complicated. There are a few reasons. Some borrowers have disabilities that, frankly, prevent them from meeting these requirements. There is also understandable confusion. You know, borrowers qualify for this loan relief because they have little or no income. So they think, why would I need to verify my income?

CHANG: Yeah.

TURNER: I also, however, spoke with a borrower, Drew Lehman, who says he did his income paperwork, and he did it early. And he continued to be rejected.

DREW LEHMAN: And they didn’t want to tell me what I had to say or what I needed to do about it. They kept sending him back, saying there was something wrong. It wasn’t until almost three months into this process that someone said: this is what we have to say.

TURNER: So Ailsa, as part of this temporary change announced today, borrowers like Lehman won’t have to send in their income documents during the pandemic. But they will always be part of this three-year follow-up. When I told Lehman this morning he said he was going to send his papers anyway because he just didn’t trust the system at this point. You know, he told me several times before that he was afraid he would make a little mistake.

LEHMAN: And it all comes back with a vengeance because now you’ve got all the loans plus the interest that’s piling up on top. It sounds like it’s willfully cruel, to be honest with you.

CHANG: willfully cruel. Wow. I mean, yeah, I guess it’s good news that the Education Department is helping them – what? – 41,000 borrowers. But has the department said what it is going to do to make the process easier to navigate?

TURNER: Well, other than temporarily waiving that annual paperwork requirement for the duration of the pandemic, not really. And for context, Ailsa, there are a lot of people right now who could get help but aren’t. Thus, according to the ministry, approximately 350,000 disabled borrowers were reported as recently as December as potentially eligible for this loan relief. And of these – this is essential – more than half of them were already in default. I spoke with Persis Yu. She is the Director of the Student Loan Assistance Project at the National Consumer Law Center.

PERSIS YU: It really is a tragedy. It is about the fact that during the pandemic they reinstated the loans of borrowers with disabilities. We shouldn’t be celebrating the fact that we are undoing this terrible thing. This terrible thing should never happen in the first place.

TURNER: You know, several advocates have told me that the ministry should get rid of income monitoring altogether and just make debt relief automatic for borrowers with disabilities. This morning, on a call with the ministry, I asked if they were considering such an initiative, and I was told, “We continue to look for what else we can do here.”

CHANG: That’s NPR Education correspondent Cory Turner.

Thanks, Cory.

TURNER You’re welcome, Ailsa.

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