Federal Student Loans and Social Security Disability

Clients often ask us if their Social Security disability awards can be taken by their creditors. Unfortunately, many clients who are forced to wait a year or longer for their Social Security Disability awards to go through have overdue bills and calls from creditors. Typically, creditors cannot touch a Social Security Disability award. One major exception, however, is the federal government. Debts owed to the federal government can be taken from a Social Security check.

An increasing number of Social Security beneficiaries have federal student loan debt. A recent Government Accountability Office (GAO) report indicated that the number of individuals whose Social Security benefits were offset to pay student loan debt increased five-fold. However, certain types of federal student loans can be forgiven if the debtor is found to be “Totally and Permanently Disabled” (TPD).

While this is a different standard than Social Security’s definition of disability, the Department of Education will accept the SSA notice of award for disability as proof of a borrower’s TPD. But only if the notice indicates that the SSA will review the borrower’s continuing eligibility for benefits once every five to seven years.

Obtaining a TPD discharge can be helpful to disability beneficiaries to avoid benefit offset. Information about applying for a TPD discharge can be found at

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