US to erase student debt for those with severe disabilities

The Associated Press ^ | August 19, 2021 | By COLLIN BINKLEY

[Oldeconomybuyer]

The Biden administration announced Thursday it will automatically erase student loan debt for more than 300,000 Americans with severe disabilities that leave them unable to earn significant incomes.

The move will wipe out more than $5.8 billion in debt, according to the Education Department, and it marks the start of a broader overhaul of a program that has been criticized for having overly burdensome rules.

“We’ve heard loud and clear from borrowers with disabilities and advocates about the need for this change and we are excited to follow through on it,” Education Secretary Miguel Cardona said in a statement.

The federal government offers student debt relief for people who are “totally and permanently disabled” and have limited incomes. But the current rules require them to submit documentation of their disability and undergo a three-year monitoring period to prove they’re earning little pay.

Tens of thousands of people have been dropped from the program and had their loans reinstated simply because they failed to submit proof of their earnings, however, and critics say the complex rules deter some from applying.

Biden has asked the Education and Justice departments to assess the legality of mass debt cancellation. Cardona said Thursday that those conversations are “still under way.” Meanwhile, he said, his agency is working to improve other debt forgiveness programs that target specific groups of borrowers.

“It’s an effort to show that we are working to improve targeted loan relief and help our borrowers,” he said.

[Chode]

[AZJeep]

So now anybody can declare disability and get out of debt free. No documentation needed.

[crusty old prospector]

There won’t be any fraud with that program.

[struggle]

Most people with Ph.Ds are retarded, so this is helpful.

[T.B. Yoits]

Erase debt? No, this passes it on to taxpayers.

[PeterPrinciple]

The federal government offers student debt relief for people who are “totally and permanently disabled” and have limited incomes. But the current rules require them to submit documentation of their disability and undergo a three-year monitoring period to prove they’re earning little pay.

Tens of thousands of people have been dropped from the program and had their loans reinstated simply because they failed to submit proof of their earnings, however, and critics say the complex rules deter some from applying.

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already a solution in place but they don’t like it.

[Skywise]

This was ALWAYS the goal of nationalizing student loans that Obama and Pelosi demanded.

Destroying the country by tricking people into getting worthless degrees and gritting communist colleges into power centers for the communist revolution.

[ConservativeInPA]

Money has no value. No big deal.

You know, the Democrats should give a massive tax cut to everyone: marginal rate: 0%. It wouldn't make any difference. While they are at, increase the Federal budget to $48 Trillion per year. Just pulling a number out of my ass ... the same logic Democrats use.

[frogjerk]

Severe disabilities like gambling addiction, obesity, ADD, etc... What are these “severe” disabilities? I know you can get social security benefits for gambling addiction...I could not believe it when I saw it on TV.

[1Old Pro]

I’d prefer that along with a loan, the borrower much purchase both a term life policy and a disability policy so in the event of death or disability taxpayers get their funds back.

[Migraine]

I predict a pandemic of limping people.

[Salman]

Will being African American be considered a severe disability?

What about being a woman (trans or regular)?

[kingu]

Why were they given loans in the first place?

Oh, right, because they’d never have to repay them so long as they continued to not make much money, this just jumps the three year process.

[CivilWarBrewing]

Totally unconstitutional. Discriminatory, OBVIOUSLY!

[Dr. Franklin]

Erase debt? No, this passes it on to taxpayers.

Actually, the taxpayers have already paid for it. The question is does the government now write-off the bad debt like a business would, or does it continue to pay government bureaucrats to attempt to collect on uncollectable debts? Counting uncollectable debts as assets helps hide the national debt, and it also gets used to increase the U.S. Dept. of Ed's budget. A reasonable business person would just write off the bad debt at some point in time, but government does things differently.

[qwerty1234]

maybe we shouldn’t lend money to students that are so disabled they have no ability to earn a living and pay it back? Nah, thats too obvious.

[xenia]

He can just do this without Congress etc? We have no say as usual.

You can’t break the laws of economics without consequence. It’s coming......

[stanne]

Somebody has to pay that debt.

Won’t be democrats buying votes with this dunbsh&t idea

[Sgt_Schultze]

In February 2022, the folks whose debt is forgiven will receive a 1099-C from the bank holding the debt. It will indicate the lump sum value of the total amount forgiven as taxable income for the current tax year. They will owe Federal, Social Security, Medicare, and probable State taxes on this amount, on their April 15 returns.

The squeals will be music!