Veterans Disability Discharge
Veteran borrowers will be considered totally and permanently disabled for purposes of this discharge if they provide documentation from the U.S. Department of Veterans Affairs (VA) showing that they have been determined to be unemployable due to a service-connected disability.
Veterans Disability Discharge Standards
There are two types of disability ratings granted by the VA that qualify a veteran for a discharge of his or her Title IV student loans and/or TEACH Grant service obligation based on the statutory standard described above:
- A determination that the veteran has a service-connected disability, or service-connected disabilities, that are 100% disabling; or
- A determination that the veteran is totally disabled based on an Individual Unemployability determination.
How to Apply
A veteran applying for TPD discharge must provide a VA Rating Decision or a letter from the VA confirming that the veteran has received one of the qualifying ratings (100% disabled due to one or more service-connected disability conditions or individual unemployability). If the veteran provides this documentation, the veteran is not required to have a physician complete Section 4 of the TPD Discharge Application or provide any additional documentation related to his or her disabling condition. The veteran applying for TPD discharge will only need to complete Sections 1 and 3 of the TPD Application.
The veteran should send the completed application and attached VA documentation to his or her loan holder(s).
Eligible for Discharge
If the veteran qualifies for discharge under this separate process, the veteran will receive immediate discharge and will not be subject to the three-year post-discharge monitoring period. The veteran's loan holder(s) will refund any payments received after the effective date of the grant of disability.
Not Eligible for Discharge
If the veteran is not deemed eligible by his or her loan holder(s), the veteran can still apply for total and permanent disability discharge through the standard process described throughout the rest of this Web site. The veteran must have his or her physician complete Section 4 of the TPD application, and the veteran will be subject to the three-year monitoring period under the standard TPD process.
The Department is aware of some VA physicians refusing to sign the TPD application, citing that VA policy prohibits them from certifying a veteran's total and permanent disability. Any veteran encountering this problem should share a copy of this Veterans Health Administration Directive with his or her physician. The directive was issued on October 29, 2008.
Veterans continuing to encounter this problem should contact their loan holder(s).
For complete, detailed information on the procedures for discharging Title IV loans and/or TEACH Grant service obligations for qualifying veterans, please review the Dear Colleague Letter (GEN-09-07) on this subject.