Unfortunately, it is extremely difficult to get rid of your student loan debt. However, there are a limited number of ways to completely get rid of your debt. Let’s consider the following arguments:
What works
1. Identity Theft and Unauthorized Signature Disputes
You may be able to eliminate your student debt if someone else took out loans in your name or if a student loan has been incorrectly attributed to you. In order to prove that you are not the person who received this loan, you will be required to show U.S. Department of Education (Department) representatives proof that you are not the individual identified on the loan records. This evidence typically includes samples of your signature and photocopies of the following:
- Your Social Security Card
- Your Driver’s license or government-issued ID card
- Your Passport or Birth Certificate
Scenario 1: If the loan records show a name that is the same as yours, but the SSN shown as that of the borrower is not your SSN, and you did not sign a promissory note for the loan:
In order to prove that you are not the person who received this loan, you will be required to show Department representatives proof that you are not the individual identified on the loan records. This evidence typically includes samples of your signature and photocopies of the following:
- Your Social Security Card
- Your Driver’s license or government-issued ID card
- Your Passport or Birth Certificate
Scenario #2: This loan has your name and SSN, but you did not sign a promissory note for the loan.
To prove that the promissory note was forged, you will be required to submit examples of your signature from around the time that the loan was made (e.g., from tax returns for that year, driver’s licenses issued at that time, cancelled checks that you wrote at that time). Alternatively, you can provide proof that you did not attend the school for which the loan was made (e.g., proof that you were living, employed or enrolled in school elsewhere at that time.). Lastly, if you are unable to provide such proof, you can provide a report from an independent handwriting expert to support your claim.
Scenario #3: You are the victim of identity theft.
If you believe you qualify for an identity theft discharge, you must complete, sign, date, and submit a discharge application to U.S. Department of Education representatives for consideration of loan discharge. You can request an application form from the party that holds your loan, or you can click here to download the application form.
Include with your application form the information described below:
- A court judgment that was made in your favor that conclusively finds that you were a victim of identity theft and identifies the name(s) of the individual(s) who committed the crime.
- Any supporting written statement that describes how the identity theft relates specifically to your student loan(s).
- A clear copy of a valid government-issued photo identification card (i.e. Driver’s License, State-issue ID Card, or Passport) OR a clear copy of your Social Security Card.
Send the documents to the party that holds the loan. Check a recent demand letter or bill for this loan; if the address to which you are requested to send payment is the National Payment Center in Greenville, TX, you should submit this documentation to:
2. Disability
- Your student loan may be discharged (forgiven) if you become totally and permanently disabled. If a physician (doctor of medicine or osteopathy) certifies that you are totally and permanently disabled and you meet other requirements during a three-year conditional discharge period, your
loan(s) may be discharged. This disability standard may differ from disability standards used by other federal agencies (for example, the Social Security Administration) or state agencies. Except as noted below for certain veterans, a disability determination by another federal or state agency does not establish your eligibility for this discharge. - You do not qualify for discharge if the medical condition or impairment existed at the time you applied for the loan, unless after that time, the condition significantly deteriorated and then you became totally and permanently disabled. In other words, an individual who was already totally and permanently disabled when he or she applied for a loan cannot have that loan discharged for that condition.
- If you are a veteran, you will be considered totally and permanently disabled for the purposes of this discharge if you provide documentation from the U.S. Department of Veterans Affairs showing that you have been determined to be unemployable due to a service-connected condition. If you provide this documentation, you are not required to have a doctor complete Section 4 of this form or provide any additional documentation related to your disabling condition. Veterans who qualify under this standard are eligible for immediate discharge and are not subject to the standard discharge process that entails a three-year conditional discharge period.
Note: PLUS loans obtained by a parent on behalf of a student are not dischargeable on the basis of the student’s disability.
What to Do:
If you believe you qualify for a discharge due to total and permanent disability, you and your doctor must complete and sign a discharge application form. (As noted above, veterans do not need to have a doctor complete the form.) You can request this form from the party that holds your loan, or you can download it now. Check a recent demand letter or bill for this loan; if you are requested to send payments to the National Payment Center in Greenville, TX, you should submit your completed form and required accompanying documentation (see form for details ) to:
U.S. Department of Education
P.O. Box 5609
Greenville, Texas 75403-5609
You may request a copy of the discharge application form by calling
1-800-621-3115. Note: in order to guard against fraud, the U.S. Department of Education (Department) will contact your doctor directly to confirm the nature and severity of your disability if you apply for a conditional disability discharge.
For more information, please visit http://disabilitydischarge.ed.gov.
3. Death
A loan can be discharged if the borrower dies or if the borrower of a PLUS loan (whether a student or parent) dies. A PLUS loan made to a parent borrower is also discharged in the event of the death of the student on whose behalf the loan was obtained.
What to Do:
The party that holds the loan must receive an original, certified copy, or a clear, accurate, and complete photocopy of the original or certified copy of the death certificate. The U.S. Department of Education cannot accept a faxed copy. Check a recent demand letter or bill for this loan; if the address to which you are requested to send payment is the National Payment Center in Greenville, TX, you should submit this documentation to:
U.S. Department of Education
P.O. Box 5609
Greenville, Texas 75403-5609
4. Closed School
You may be eligible to have your loan discharged, if you did not complete the program of study and either of the following is true:
- the school closed while you were attending, or
- the school closed within ninety days after you withdrew from the school
What to Do:
You must complete and submit a closed school discharge application form. You can request this form from the agency that holds your loan, or you can download it now. Check a recent demand letter or bill for this loan; if the address to which you are requested to send payment is the National Payment Center in Greenville, TX, you should submit your completed form to:
UNITED STATES DEPARTMENT OF EDUCATION
FEDERAL STUDENT AID
Processing Group Regional Office, Room 8633
50 Beale Street
San Francisco, CA 94105-1813
5. Unpaid Refund
If you received a loan (on or after January 1, 1986) to pay for a period of enrollment at a school that you (or for parent PLUS borrowers, the student) did not attend, withdrew, or were terminated from, you may be eligible for discharge of some or all of your loan(s). If the school was required to make a refund of your loan under federal regulations but failed to do so, you may be eligible for an unpaid refund discharge. Whether you qualify for a discharge and the amount that may be discharged will depend on your (or for parent PLUS borrowers, the student) dates of attendance at the school.
What to Do:
To apply for this discharge, you must complete and submit an unpaid refund discharge application form. You can request this form from the agency that holds your loan, or you can download it now. If you are not sure who holds your loan, check a recent demand letter or bill. If the payment address on the letter or bill is the National Payment Center, P.O. Box 105028, Atlanta, GA 30348-5028, you should submit your completed form to:
UNITED STATES DEPARTMENT OF EDUCATION
FEDERAL STUDENT AID
Processing Division, Room 8601
50 Beale Street
San Francisco, CA 94105
6. False Certification of Ability to Benefit
You may be eligible to have a loan discharged (forgiven):
- if you did not have a high school diploma or general equivalency diploma (G.E.D.) at the time you borrowed the loan, or
- If the school did not determine your ability to benefit in accordance with the federal requirements that were in effect at the time you were enrolled, or
- If you did not complete a remedial education course or obtain your G.E.D.
Different standards may apply depending when you borrowed.
What to Do:
You must complete and submit a false certification of ability to benefit discharge application form. You can request this form from the agency that holds your loan, or you can download it now. Check a recent demand letter or bill for this loan; if the address to which you are requested to send payment is the National Payment Center in Greenville, TX, you should submit your completed form to:
UNITED STATES DEPARTMENT OF EDUCATION
FEDERAL STUDENT AID
Processing Group Regional Office, Room 8633
50 Beale Street
San Francisco, CA 94105-1813
You may request a copy of this discharge application form by calling 1-800-621-3115.
7. False Certification of Ability to Benefit – Disqualifying Status
You may qualify for discharge of a loan you received if, at the time you enrolled at the school and borrowed, you had a physical or mental condition, a criminal record or other status because of which State law would prohibit you from being employed in the field for which the training was designed to prepare you. For example, if you attended a truck-driving school but did not have a driver’s license and could not obtain one because you are legally blind, you may qualify for a discharge.
What to Do:
You must complete and submit a false certification of ability to benefit due to disqualifying condition discharge application form. You can request this form from the agency that holds your loan, or you can download it now. Check a recent demand letter or bill for this loan; if the address to which you are requested to send payment is the National Payment Center in Greenville, TX, you should submit your completed form to:
UNITED STATES DEPARTMENT OF EDUCATION
FEDERAL STUDENT AID
Processing Group Regional Office, Room 8633
50 Beale Street
San Francisco, CA 94105-1813
You may request a copy of this discharge application form by calling 1-800-621-3115.
8. Bankruptcy
Whether a bankruptcy discharge relieves an individual of his or her obligation to repay a student loan or grant overpayment is now determined by whether a court has ruled that repayment would impose an undue hardship on the borrower and his or her dependents. If the bankruptcy was filed on or after October 8, 1998, the loan or grant obligation is not affected by a bankruptcy discharge unless the debtor received an undue hardship ruling from the court.
Prior to October 1998 changes in bankruptcy law, whether a loan or grant overpayment was discharged in a bankruptcy depended on different rules, depending on when bankruptcy was filed, how long the student loan had been in repayment, and what kind of student loan the debtor had received. Generally, loans or grant obligations owed and in repayment for more than five years, and later seven years by the time the borrower filed for bankruptcy relief were dischargeable by reason of the age of the debt. Debts owed and in repayment status for shorter periods were dischargeable only if a court ruled that repayment would pose an undue hardship. In addition, a general discharge received in a Chapter 13 (wage earner plan) bankruptcy that was filed before November 5, 1990 was sufficient to discharge a student loan or grant obligation without regard to how long the debt had been owed, even if the debtor failed to prove that repayment would pose an undue hardship.
You should present documentation regarding your bankruptcy case to Department representatives, who can advise whether the Department considers bankruptcy law to relieve you of the obligation to repay this debt. You may seek advice from your bankruptcy counsel in this matter as well.
If your bankruptcy petition was dismissed rather than discharged, then none of your debts, including your loan, were discharged.
What to Do:
You must submit to Department representatives the following documents to show when, and under what provision of law, you filed for, and received, relief in bankruptcy:
- Court ruling, if any, regarding whether repayment would impose an undue hardship
- Copy of the notice of the first meeting of creditors
- List of creditors filed in the bankruptcy proceeding (schedule A-3)
- Final Discharge Order
Be sure to include a cover letter stating your name, social security number and the identification number(s) of the loan or grant obligation you believe was discharged.
Check a recent demand letter or bill for this loan; if the address to which you are requested to send payment is the National Payment Center in Greenville, TX, you should submit your documentation to:
U.S. Department of Education Unit
Educational Credit Management Corporation
P.O. Box 8809
Richmond, VA 23225
You should contact a St. Louis bankruptcy lawyer to see if you qualify for a hardship discharge.
9. Balance Disputes
A Federal student loan or grant obligation, like any other financial obligation, accrues interest over time as it remains unpaid. In addition, because Federal law holds the defaulter liable for collection costs incurred to collect these debts, the amount needed to satisfy in full the financial liability on a defaulted student loan or grant obligation includes the amount incurred to collect the debt. For both reasons, unless sufficient payments have been made, the amount that you currently owe will be larger than the amount you borrowed or received as a grant.
You should also keep in mind that you may have taken out several loans, sometimes from different lenders and serviced by different parties. Thus, payments that you may remember making may have been credited toward a different loan than the loan(s) held by the Department.
What to Do:
If you have proof that you paid a specific loan or grant obligation, you must send a copy of the record of that payment to the Department or other party that is demanding that you now repay that obligation.
If you believe that one or more of the payments you have made toward your debt has not been duly credited, you must send proof to the party that holds the debt. The kind of proof you need to submit depends on how the payment was made; see below for more information.
If you sent payment via…
- Personal check. Submit a copy, front and back, of the cancelled check.
- Cashier’s check, money order or Western Union Quick Collect payment. Submit a copy, front and back, of the cancelled payment instrument. You will have to obtain this from the bank or agency that issued the check or money order. A copy of your receipt is not sufficient.
- Treasury Offset Program. Submit a copy of the notice from the U.S. Treasury’s Financial Management Service (FMS), from the Internal Revenue Service, or State Department of Taxation notifying you that your federal and/or state tax refund and/or other payment was offset. If you do not have this notice, you may obtain a copy by calling FMS at 800-304-3107.
- Credit Card. Submit a copy of the credit card’s billing statement that shows the transaction in question.
Be sure to include a cover letter with any proof you submit that includes your name and social security number.
Check a recent demand letter or bill for this loan; if the address to which you are requested to send payment is the National Payment Center in Greenville, TX, you should submit your proof to:
U.S. Department of Education
P.O. Box 5609
Greenville, Texas 75403-5609
What Does NOT Work…
1. Defense of Infancy
Student loans cannot be avoided on the basis of a borrower’s age. Section 484A(b) of the Higher Education Act of 1965, 20 U.S.C. § 1091a(b), bars this claim for Federally-reinsured loans, and State law typically does so as well.
2. Statute of Limitations
Section 484A(a) of the Higher Education Action provides that no statute of limitations bars enforcement action to collect Federal student loans, including collection by offset, lawsuit, or enforcement on student loan judgments. 20 U.S.C. § 1091a(a). State law that would otherwise limit these actions is superseded by Federal law and cannot bar collection action.
3. Defense of Laches (Unreasonable and harmful delay in demanding payment)
Because default on a publicly-financed debt, such as student loan or grant obligation, harms the taxpayer, Federal law precludes the debtor from avoiding repayment by claiming that the debt should not be enforced because of delays in demanding its repayment. Moreover, where the debt is a student loan, the borrower has agreed in the promissory note to apprise the holder of the loan of his or her current address. Thus, a claim that the debt, or interest owed on the debt, should not be enforceable because of delays in demanding payment is also barred because the borrower, not the lender or the Department, was legally obligated to notify the holder of his or her correct address.
Please contact St. Louis lawyer, Tim Powderly for a free examination of all of your debts.