Student Loans Discharged For Disabled

Posted by Misstia34@yahoo.com (199.35.136.107) on February 20, 2004 at 23:44:47:

Hello Everyone. As mentioned previously I have over $40,000 worth of student loans and I am soon due to start repayment on them. I was told that because I am disabled I may qualify for a permanent disability discharge of my debt.

I received the total permanent disability form from the bank today. I'm not sure if I'm understanding the legal wording on the form, so I am going to repeat it here in my own words. Can someone tell me if I am understanding this correctly?

This is the form I have here at home:

http://www.ed.gov/offices/OSFAP/DCS/forms/disable.pdf

I believe the form is saying that the first 3 years are a conditional discharge of the loans, where the borrow does not have to make payments on the loan. It also says in section 7, that during the the 3 year conditional discharge, the borrow can work as long as they do not make over the gross income allowed for a family of two regardless of their family size without being removed from the permanent disability three year conditional discharge period. However, the borrow can not be able to work at all during the time the doctor initially completes the permanent disability form which does apply to me now.

My only concern is whether or not my working during the 3 year conditional discharge period will prevent my discharge from taking place at the end of the 3 years if my health worsens again...maybe it's a trap by the bank to make sure they don't have to discharge the loans...lol. I thought that no working at all was allowed. What do you all think?

The form goes on to say, that after the first three years if the borrower is still considered permanently disabled the loan discharge is then finalized and the debt completely forgiven without penalty or any responsiblity to the borrower. The paperwork also says in Section 9, that after the loans are forgiven and finalized, if the borrow has an improvement in health, and returns to college in the future, they will be able to take out new loans without penalty, however, they will have to sign an agreement that future loans can not be discharged for any reason in the future, even if a permanent disability occurs. This seems too good to be true. Is all the above correct? If so this means that I will actually not have to pay back my loans, and possibly even have the future possiblity to return to work or school if my health improves? Thanks

The sections I mentioned above can be found here(same form I have at home):

http://www.ed.gov/offices/OSFAP/DCS/forms/disable.pdf

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