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TPD Loan forgiveness with VA disability rating.

New Contributor

TPD Loan forgiveness with VA disability rating.

Yesterday I began my journey to have my student loans forgiven. My medical condition has gotten worse and I have received a 100% Total and Permanent Disability rating from the Department of Veteran Affairs.

The good:


I won't enter into the 3 year waiting period.
Hopefully, it gets approved faster since the documentation sent clearly explains my conditions and my disability rating. I hope this helps expedite things.
I did not have to fill out the medical part 4 on the request form.

Now I want to document as accurately as possible the entire process so others may have an idea of time frames and steps.

 

03/27/2017


Sent completed form and supporting documentation via overnight mail and waived signature.


03/28/2017

 

The package was delivered at 10:23 am. At 6:37 Pm no update on the site.

03/29/2017
File was scanned and uploaded to the system. Was informed of this because I called to see if they had received it. At the time the kind lady informed me that since it was scanned it was waiting on a reviewer to uploaded it and assign a case number to it.

04/05/2017

Logged in and my case had been assigned a number and all the student loans were present. In the file. Including a recent one from a month ago. I'm still going to school. Not sure how that will affect the case but I was rated at 100% less than a month ago.

 

05/04/2017

 

Logged in today and finally saw a status change. I was getting a little anxious but this gives me a little more hope. The new status is Pending Final Approval.

I've read in some places from this point on it can take anywhere from 3-10 weeks to get the approval. After the approval, I will continue to document the steps to see what happens to the credit score and how they report it.

May 5th Update.


Now I called on the 1st of May and managed to get someone to explain how the process works. The young lady mentioned that They review my file and do a "soft approval" and send it to the Department of Education to get the final approval. Once they receive the final approval it gets send to Navient. Navient will then send me the correspondence explaining that they have been discharged and send the loan holders the information so they can update the records and credit reports.

05/13/2017

Called to see the status and was informed that my paperwork still hadn't been sent to the DE. When I asked if I needed to send something else they informed me that they send them in batches.

05/18/2017

 

My discharge was approved.  On the website it says permanent Discharge. If you call they can send you the letter via email.

 

5/24/2017 
I decided to check Fedloan website to see what the status of the loans was. The loans all appear Paid in Full. I have to admit that when I saw this i felt like a huge rock was lifted off my shoulders. I'm officially debt free and waiting to close on our new house. 


All that is left is for them to report it to the all 3 CBs. 

06/05/2017

All my student loans are off all 3 CBs.

 

One step closer.

Amex Plat | Business Amex Plat | NFCU Cash Rewards $22,100 | Discover iT $1,000 | Capital One Plat $1750 | Capital One Quicksilver $2000 | Walmart SC $5000 | Amazon SC $4000 | Military Star Card $1750 NFCU CLOC $500 | NFCU PL $7500 |
27 REPLIES
Established Contributor

Re: TPD Loan forgiveness with VA disability rating.

Thank you for the update, and yes please keep us posted on the progress.  I think this is a topic that probably needs some additional clarity on the forums.  I know there is another community member that has some questions about the TPD process, so this will certainly help.


Starting Score: Eq: 662 Tu: 532 (03/02/2011) CH7BK 01/12/2009 Discharge
Current Score: Eq: 712 (02/03/2017) Tu: 717 (04/03/2013)
Goal Score: Eq: 760 Tu: 760

Wallet: PenFed Power Cash 25k | AMEX Blue Cash (AU) 49.5k | Cap One QSMC 26.5k | AMEX Platinum NPSL | LFCU Visa 10k
Message 2 of 28
New Contributor

Re: TPD Loan forgiveness with VA disability rating.

Main post updated!

Amex Plat | Business Amex Plat | NFCU Cash Rewards $22,100 | Discover iT $1,000 | Capital One Plat $1750 | Capital One Quicksilver $2000 | Walmart SC $5000 | Amazon SC $4000 | Military Star Card $1750 NFCU CLOC $500 | NFCU PL $7500 |
Message 3 of 28
New Contributor

Re: TPD Loan forgiveness with VA disability rating.

Update on first post.

Amex Plat | Business Amex Plat | NFCU Cash Rewards $22,100 | Discover iT $1,000 | Capital One Plat $1750 | Capital One Quicksilver $2000 | Walmart SC $5000 | Amazon SC $4000 | Military Star Card $1750 NFCU CLOC $500 | NFCU PL $7500 |
Message 4 of 28
Established Contributor

Re: TPD Loan forgiveness with VA disability rating.

This is fantastic.  Thank you for sharing your experience and providing some direction on how this process works.  It certainly is an unfamilar process to me.  I'm glad things are moving forward for you.


Starting Score: Eq: 662 Tu: 532 (03/02/2011) CH7BK 01/12/2009 Discharge
Current Score: Eq: 712 (02/03/2017) Tu: 717 (04/03/2013)
Goal Score: Eq: 760 Tu: 760

Wallet: PenFed Power Cash 25k | AMEX Blue Cash (AU) 49.5k | Cap One QSMC 26.5k | AMEX Platinum NPSL | LFCU Visa 10k
Message 5 of 28
New Contributor

Re: TPD Loan forgiveness with VA disability rating.

Updated in the main post.

Amex Plat | Business Amex Plat | NFCU Cash Rewards $22,100 | Discover iT $1,000 | Capital One Plat $1750 | Capital One Quicksilver $2000 | Walmart SC $5000 | Amazon SC $4000 | Military Star Card $1750 NFCU CLOC $500 | NFCU PL $7500 |
Message 6 of 28
New Contributor

Re: TPD Loan forgiveness with VA disability rating.

Main Post updated

Amex Plat | Business Amex Plat | NFCU Cash Rewards $22,100 | Discover iT $1,000 | Capital One Plat $1750 | Capital One Quicksilver $2000 | Walmart SC $5000 | Amazon SC $4000 | Military Star Card $1750 NFCU CLOC $500 | NFCU PL $7500 |
Message 7 of 28
New Member

Re: TPD Loan forgiveness with VA disability rating.

So how did this affect your credit score? I have been working since October to get my credit scores up, most of them have gone up almost a hundred points by paying off several collections and charge offs so for most of my scores I'm at almost 700, (the 680's) for all except Trans Union which seems to drag there feet alot. I am also a veteran and just got 100% disabled and unemployable. I am wondering how having these accounts forgiven has affected your credit score, please let me know. I read an article a few months ago stating that if Navient didn't report it correctly it could really screw up your credit. I have something like 32 accounts that show consolidated in to one account where I owe a little over 100k. I am going to by a car in a month or two, and then next year start working on buying a house using my VA loan. I am really scared that if I do this its going to ruin all of the hard work that I have done, my credit scores right now are the best I have ever had in my life. If it will help my credit (I know it will help my amount of debt) as soon as congress signs the new tax bill so that I don't have to pay taxes on the forgiven amount I will, assuming the answer to my question on here is that it helped your credit, or your score went up. Thank You for any help or suggestions.

Message 8 of 28
Established Contributor

Re: TPD Loan forgiveness with VA disability rating.

Curious as to how IRS has treated this Forgiveness? Have heard horror stories of Treating the forgiveness as income and generating a huge tax bill.
Message 9 of 28
New Member

Re: TPD Loan forgiveness with VA disability rating.

the Irs doesn't taxes this as income anylonger, it was in the new tax bill.

Message 10 of 28