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  #1  
Old 09/27/10, 06:08 PM
 
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Forgiving student loans

Has anyone had their student loan forgiven? We filled out the paperwork to have my loan forgiven and they said that it looked like I qualified for this. But.... there was a comment about needing to be below the federal poverty limit for a family of 2. With my disability payments we're not. Too bad the approval didn't come before my disability came through.

Is it possible to have your loan forgiven if you're getting disability payments?
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  #2  
Old 09/27/10, 06:28 PM
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Usually student loans are not forgiven, but mine were. The bank I got my loans from some 25+ years ago sued the Federal Government over student loans. The eventual outcome of that was a lot of their loans were sold to a company that went under for whatever reason. Technically my loans weren't "forgiven" they were lost and, since the Feds couldn't locate them they were wiped from my FAFSA record.

I have no idea about disability and student loans. Just wanted to let you know that student loans can be forgiven in certain circumstances.

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  #3  
Old 09/28/10, 09:44 AM
 
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My husband is a disabled veteran (100%) and he was denied loan forgiveness. Hopefully it will be better for you.

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  #4  
Old 09/28/10, 11:17 AM
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I am a 100% disabled veteran. I get VA disability and Social Security Disability and I WAS given loan forgiveness... jbowyer01, can you appeal the descision??

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Old 09/28/10, 12:45 PM
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jbowyer01,

I would strongly encourage your husband to appeal the decision or re-apply. I have helped a few of my clients to obtain loan forgiveness for student loans. One client had been denied repeatedly, despite being a 100% disabled Viet Nam veteran. In his case, we found that he had to be persistent in following everything up. He had to call/visit repeatedly to get the VA Hospital to send his records and all appropriate forms in order to get everything approved. Apparently, they deny the claim if even one line of a form isn't completed and they do not necessarily tell you what the problem is with your application. It took about a year from the time that I became involved. When it was finally granted, it was not conditional and there was no poverty waiting period. Only veterans can qualify for the forgiveness program without a waiting period.

It is more difficult for a non-veteran to get loan forgiveness and there are income requirements that you have to fall under for a period of 2 or 3 years. It wasn't easy for another of my clients to fall under those income guidelines because she is single and has no children. In order to qualify, she had to obtain a lot of her food from food pantries and giveaways to be able to stay within that meager budget. I believe that she ws receiving some sort of SSDI, but I may be mistaken.

My most recent client to file (back in December) received a letter in June indicating that she is likely to be approved. Her only form of income is a very small amount of alimony and Social Security. She is in her 60's and it shouldn't be too difficult for her to meet the income guidelines for the next couple of years.

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  #6  
Old 09/28/10, 01:40 PM
 
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Originally Posted by TheMartianChick View Post
Apparently, they deny the claim if even one line of a form isn't completed and they do not necessarily tell you what the problem is with your application. It took about a year from the time that I became involved. When it was finally granted, it was not conditional and there was no poverty waiting period. Only veterans can qualify for the forgiveness program without a waiting period.

It is more difficult for a non-veteran to get loan forgiveness and there are income requirements that you have to fall under for a period of 2 or 3 years.
They said that it looked like I qualified on the first application. It didn't take them very long to respond either. The problem is that they said you had to meet federal poverty guidelines for a family of two. Funny thing is that they didn't ask how many people are in my family. For all they know there's only one instead of three. How in the world do I get this forgiven? Is it possible?
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  #7  
Old 09/28/10, 01:49 PM
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I would start the appeal process. It gives you an opportunity to state the reason that you believe that their decision was in error. Make certain to mention any reason for denial given in the letter and address it. They will probably ask for permission to pull last year's tax returns or ask you to provide them with copies. Don't give up hope! I believe that it is harder to get the loan forgiveness when you have something like fibromyalgia, chronic fatigue and other ailments that don't present themselves in a cookie cutter fashion. It can still happen. You just have to be persistent.

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  #8  
Old 09/28/10, 01:51 PM
 
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Didnt mean to hijack the thread but I will talk to DH about it. I think he's tired of fighting it took us 5 years to get his VA disability and we are still waiting on social security (they say Ga is one of the worst states) we do have an attorney and have already been to a hearing but his file is evidently sitting on someones desk. (oh and he's 90% disabled with 10% unemployability) but somehow thats not 100% all the time go figure.)

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  #9  
Old 09/28/10, 01:59 PM
 
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jbowyer01, make sure your lawyer gets a letter from the doc saying that he is totally unable to work. If you don't have that SS won't be approved. Student loan will not be forgiven unless you're totally disabled. My doc sent a letter saying I'd never be able to work and that I have problems with my ADLs. I can't shower because I fall and I have to make sure someone is close when I take a bath because of my seizures. I think it also helped with student loans because I cannot drive anymore.

TheMartianChick, the student loan place approved my application for forgiving my student loan but said I had to meet federal poverty guidelines. I'm not a vet. DH is but I'm not. DH is in his 70s and I'm in my late 40s. I went back to school in my late 30s and graduated with a second BS at age 40.

They've not turned me down. They've given me a conditional discharge based upon the income guidelines. Frustrating.
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  #10  
Old 09/28/10, 02:10 PM
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The only thing that you can do right now, is to wait for their final ruling. Keep trying to document anything that might help your case. Get additional letters from all of your doctors, etc... This way, it isn't just one doctor saying that you are disabled. I would ask for income clarification in a letter and then make sure that you qualify.

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  #11  
Old 09/28/10, 05:46 PM
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They probably know the number in your family from your income tax statements. The government is able to look at those when you apply for any kind of loan, or deferment, or in your case, the dissolution of the loan.

If you are 100% disabled, you should be able to push for the loan forgiveness. It will likely take a LOT of work on your part tho. Put together a packet that has a month's bills, all of them. Meds. Your co-pays. Insurance costs. Food costs. gasoline. heating. water. sewer..anything you can think of. Total it. Then put your incomes up against that. Show the <whoever it is> that you simply can't add another debt.

The other option, of course, is to offer to pay a PORTION of the loan in exchange for forgiving the rest. After all..you DID make use of the services, and you got your degree. Most times they'll work with you and accept a partial repayment. There are so MANY people defaulting on loans for school that if you show any attempt at trying, they'll start smiling and nodding instead of just saying NONONO all the time.

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  #12  
Old 09/28/10, 10:07 PM
 
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Originally Posted by Wisconsin Ann View Post
They probably know the number in your family from your income tax statements. The government is able to look at those when you apply for any kind of loan, or deferment, or in your case, the dissolution of the loan.
If you print out the forms from the student loan site it says that you have to meed federal poverty guidelines for a family of 2. It has nothing to do with us. You could have 10 kids. We'll wait to see what happens. Doesn't look like they care about your bills.
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  #13  
Old 09/28/10, 11:12 PM
 
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Yes, you can get loan forgiveness if you are disabled, even if you're not a veteran. You have to either have the paperwork from Social Security, or have your doctor fill out a form stating you're disabled and send it to the loan division. Contact wherever your loans are serviced and ask them to send you the correct forms for disability, because disability doesn't have anything to do with income. Income can be considered for deferrments, and putting off payments, but the disability will get the loans forgiven.

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  #14  
Old 09/28/10, 11:13 PM
 
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I didn't have to show any proof of income, or tax returns, or anything else, and mine were government loans. I just had to have the doctor fill out the correct form stating that I'm disabled, and I included a copy of my letter from Social Security. When I had the form filled out, I didn't even have the letter yet, just had the approval by phone with the date that I'd been approved, so I was told to just print that on the form before I sent it in.

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  #15  
Old 09/28/10, 11:17 PM
 
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By all means apply. Just be aware that having a student loan forgiven just doesn't happen very often. Circumstances really have to be dire and even then you have to meet guidelines that no one seems to understand.

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  #16  
Old 09/29/10, 07:27 AM
 
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I'm going to go out on a limb here and say...you should pay the loan. The loan companies will work with you on a payment plan that you can deal with. I've got a lot of money in my college degree and even though I'm staying at home with my kids now, the loan companies have been extremely reasonable in accommodating my payment requirements.

It's just not fair to the kids out there who are going to need to go to school in the future for you to neglect your responsibilities. It's not like a car or a house that they can repossess. When you default on your student loans, they can't repo your degree. You're just making things hard on the people you borrowed from and, therefore, on anyone who may want to borrow from them in the future.

The income guidelines are there for a reason, if you have X amount of money coming in, they reason that you should be able to apply a certain amount of that to your loan.

I'm not saying that it won't be difficult for you, and I'm not trying to minimize your medical issues. But I really think you should take a look at your finances and if there's some kind of extra that can be cut out in order to make your student loan payment, then I think you should do it. It's only fair.

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  #17  
Old 09/29/10, 09:18 AM
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I was unaware that you could get loan forgiveness for disability - or rather, I thought that you had to be receiving disability payments to get forgiveness.

Right now, I'm making payment through the IBR: Income Based Repayment system. But I will look into the disability forgiveness.

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  #18  
Old 09/29/10, 10:06 AM
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Originally Posted by Lada View Post
I'm going to go out on a limb here and say...you should pay the loan. The loan companies will work with you on a payment plan that you can deal with. I've got a lot of money in my college degree and even though I'm staying at home with my kids now, the loan companies have been extremely reasonable in accommodating my payment requirements.

It's just not fair to the kids out there who are going to need to go to school in the future for you to neglect your responsibilities. It's not like a car or a house that they can repossess. When you default on your student loans, they can't repo your degree. You're just making things hard on the people you borrowed from and, therefore, on anyone who may want to borrow from them in the future.

The income guidelines are there for a reason, if you have X amount of money coming in, they reason that you should be able to apply a certain amount of that to your loan.

I'm not saying that it won't be difficult for you, and I'm not trying to minimize your medical issues. But I really think you should take a look at your finances and if there's some kind of extra that can be cut out in order to make your student loan payment, then I think you should do it. It's only fair.
It is awfully hard to make a pronouncement like that without knowing all of a person's circumstances. In many cases, people do not realize that loan forgiveness exists and don't apply for it when they are first eligible. Student loans payments can be sent off to collection agencies that tack ENORMOUS fees onto the balances.

The 60+ year old woman that I mentioned watched her balances triple in the past ten years. Most of that wasn't interest, but collection fees that were added on. The collection companies weren't interested in providing a payment that would fit into her budget. I would have been surprised if she had been able to pay $10 per month. The amount of income that she was receiving was barely enough for her to live on. (I had made a habit out of keeping crackers and granola bars in my desk to offer to her while we talked.)
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  #19  
Old 09/29/10, 11:13 AM
 
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Originally Posted by TheMartianChick View Post
It is awfully hard to make a pronouncement like that without knowing all of a person's circumstances. In many cases, people do not realize that loan forgiveness exists and don't apply for it when they are first eligible. Student loans payments can be sent off to collection agencies that tack ENORMOUS fees onto the balances.
I'm not trying to make a broad generalization. I'm sure there are folks out there who qualify for loan forgiveness, as they should because of their circumstances. That's why there is such a thing as forgiveness. The reason there are requirements to meet in order to qualify is so that ONLY the people who REALLY need it are given forgiveness. I'm just saying that based on what Joshie is saying...that she doesn't meet the income guidelines...that she should attempt to pay them instead of trying to get out of it.
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Old 09/29/10, 12:18 PM
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Originally Posted by Lada View Post
I'm not trying to make a broad generalization. I'm sure there are folks out there who qualify for loan forgiveness, as they should because of their circumstances. That's why there is such a thing as forgiveness. The reason there are requirements to meet in order to qualify is so that ONLY the people who REALLY need it are given forgiveness. I'm just saying that based on what Joshie is saying...that she doesn't meet the income guidelines...that she should attempt to pay them instead of trying to get out of it.
You don't know what Joshie is going through, why she's on disability, or how far the disability $$ goes. I can assure you, it's not a fortune, and when you're paying for meds and other things, it goes pretty darned fast.

I suggest putting the best construction on everything, and assume that there are reasons to which you are not privy that prevent Joshie from being able to make the payments on the loans.
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  #21  
Old 09/29/10, 12:24 PM
 
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As someone who has the same kind of loans...there are things I'd rather be putting the money towards too! I'm not trying to be snarky, I just don't think it's o.k. to shirk your responsibilities. If she's making enough money that she's not qualifying for the loan forgiveness, then that's that. I'm not saying she shouldn't GET the forgiveness if it's determined that she qualifies. I'm saying she shouldn't finagle and ask opinions on ways to get around the fact that she doesn't meet the income guidelines.

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Old 09/29/10, 02:58 PM
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Originally Posted by Lada View Post
As someone who has the same kind of loans...there are things I'd rather be putting the money towards too! I'm not trying to be snarky, I just don't think it's o.k. to shirk your responsibilities. If she's making enough money that she's not qualifying for the loan forgiveness, then that's that. I'm not saying she shouldn't GET the forgiveness if it's determined that she qualifies. I'm saying she shouldn't finagle and ask opinions on ways to get around the fact that she doesn't meet the income guidelines.
The problem is that the applications are handled by paper-pushing bureaucrats who seem to deny applications before they actually read them. A denial does not actually mean that she does not meet their qualifications. Errors are made frequently!
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  #23  
Old 09/29/10, 03:12 PM
 
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The problem is that the applications are handled by paper-pushing bureaucrats who seem to deny applications before they actually read them. A denial does not actually mean that she does not meet their qualifications. Errors are made frequently!
And that's fine, but she does state in her original post that it says you have to be below the federal poverty guidelines for a family of two and they are not. That's all I'm going off of.
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Old 09/29/10, 04:16 PM
 
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As someone who has the same kind of loans...there are things I'd rather be putting the money towards too! I'm not trying to be snarky, I just don't think it's o.k. to shirk your responsibilities.
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And that's fine, but she does state in her original post that it says you have to be below the federal poverty guidelines for a family of two and they are not. That's all I'm going off of.
Wow. How in the world am I trying to shirk my responsibilities? If I was, I'd have just stopped paying and that never crossed my mind. I'm not trying to be irresponsible and I asked for advice about the program for discharging a student loan. You know what they say about making assumptions....

Federal poverty guidelines for a family of two (and ours is not a family of two) is about $14,000. The government wouldn't have a loan forgiveness program if they didn't think it was necessary. It's not irresponsible to use available programs. If you had 20 children, the federal guidelines would say that you can have only $14,000 in income?? That makes absolutely no sense.

The thing is that the poverty level does not consider deductions. If I have a choice between paying for thousands of dollars of medications we take, paying for a place to live, eating, or paying for a student loan.... I'm not gonna choose the student loan. I'm current on the student loan despite the fact that we went through all of our savings and went a whole year without any income other than my husband's SS retirement. Net income is less than $900/month. Guess what? That income, before deductions, would be above the federal poverty guidelines. You try eating when you're disabled, your hubby is in his 70s, and your children have very significant medical disabilities. You try paying for the necessary travel out of state for medical care that often requires a hotel room.

Tell you what.... you can pay for my $400 + seizure med, my expensive pain meds.... the $1000++ per month in medications. Don't make assumptions.
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Last edited by Joshie; 09/29/10 at 04:21 PM.
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  #25  
Old 09/30/10, 07:50 AM
 
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I think if I had those kind of responsibilities, I wouldn't have taken the loan out to begin with. You said you went back to school in your late 30s, graduated with a second degree at 40, and it's now, what...8 years later and you can't pay the loan? Did you even use the degree? What were you thinking when you originally took on the debt? Your husband would have already been older at the time, possibly retired. Unless all these medical problems have happened to you, your husband and your children in the last 8 years?

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Old 09/30/10, 08:07 AM
 
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I think if I had those kind of responsibilities, I wouldn't have taken the loan out to begin with. You said you went back to school in your late 30s, graduated with a second degree at 40, and it's now, what...8 years later and you can't pay the loan? Did you even use the degree? What were you thinking when you originally took on the debt? Your husband would have already been older at the time, possibly retired. Unless all these medical problems have happened to you, your husband and your children in the last 8 years?
Lada, I know where you are coming from with this statement. Just let me say that the government has no money except that which they take from the people. Loans are money spent == someone has to pay. If at all possible that should be the person that used the money, not the rest of the taxpayers.
Same with folks that declare bankruptcy -- that owed does not magically dissappear, it is covered by all other folks eventually through higher prices, etc.

I know there are always exceptions and I do have compassion for disabled people (my dad was one at an early age, we struggled, that was in the 50's)
but IMO bankruptcy and loan forgiveness, etc, has gotten way out of hand.
Just my opinion.
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Old 09/30/10, 08:50 AM
 
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Thank you, I'm glad someone else can see the point I'm trying to make. There are many options out there. I myself deferred my loan for 3 years when I first quit work to stay at home with my children. I didn't make ONE payment for 3 years, but that's not to say that the loan magically disappeared. I took on the debt, and I will pay it. It's just the right thing to do.

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  #28  
Old 09/30/10, 08:53 AM
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I got an advanced degree in my 40's. I was healthy at the time, and thought that getting that terminal degree would be the best way to be able to support myself and family.

Fast forward a couple of years, and got hit out of the blue with a stooopid disorder that keeps me from being able to work consistently or reliably. I was always a go-getter, always painfully responsible, I never backed down from a challenge, there was NOTHING that could stop me.

Yeah, that changed real quick.

So those of you who would imply that people are trying to welch out on a responsibility haven't really gotten hit with all that the enemy can throw at you and/or your family. You're lucky or just haven't had the experience yet.

We're not people who took out these loans with the intent of not paying them back. I had every intention of having those loans paid off EARLY - because that's how I operate.

We didn't file bankruptcy. We moved to a MUCH lower standard of living, even though we'd lived pretty much debt free (not counting the mortgage), yet we knew that something had to give.

We are NOT on the govt dole. I refuse to pursue disability. But I have to make income based repayments because the money is just not there.

(I chose not to get into how eager the grad schools are to mislead you into how easy it is to pay off loans, how much money you can make following grad, et al. But that's part of the equation, too.)

My point is, you can be in the fast lane, doing everything right and following all the rules, and BAM! get hit upside the head with a big ol' 2x4 and never know what the heck hit you.

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Old 09/30/10, 09:13 AM
 
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My point is, you can be in the fast lane, doing everything right and following all the rules, and BAM! get hit upside the head with a big ol' 2x4 and never know what the heck hit you.

God thats how I feel every day lol.
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  #30  
Old 09/30/10, 09:16 AM
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Because of the financial gain from a forgiven debt is a 1099 issued to reflect that?

I would assume that the amount forgiven and thus gained would then be counted as taxable income by the IRS.

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