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TPD Loan forgiveness with VA disability rating.

Your FICO® Scores can impact your loan interest rates, terms, approvals and more.
Established Member

Re: TPD Loan forgiveness with VA disability rating.

The VA actually submitted my name to Nelnet, and they automatically sent a letter to my Loan Servicer to suspend payments. I then had to fill out the paperwork they sent me in the mail, send it back, I emailed it, but you can mail it back. Can’t remember if fax was an option. It took about 60 days for my Loans to be discharged. You might want to call the number on the website to see if your name was submitted by the VA. It may save you some time.
Message 91 of 98
New Visitor

Re: TPD Loan forgiveness with VA disability rating.

Thanks for the replies!

 

I just spoke with Nelnet.  You can be 100% P&T employable or 100% unemployable.  They receive your information from the VA which means you pre-qualify (basically you will be approved).  All you have to do is submit your application because they've received the supporting documents from the VA which is why they notify you.  If anyone has had a different experience - please share.  Now I'm just playing the waiting game.... I can't wait until my credit score boosts from this!!!

Message 92 of 98
Established Member

Re: TPD Loan forgiveness with VA disability rating.

You’re welcome, and that is my experience. Just be patient, and you should be fine.
Message 93 of 98
New Member

Re: TPD Loan forgiveness with VA disability rating.

I know we don’t have to pay federal income tax on our discharges loans but my question is do I have to pay state taxes on my discharge. I live in Arkansas and I’m discharging around $114,000. My discharge in final pending for approval phase.

Also I have about $3,500 of interest that’s owed will that be discharged as well or do I have to pay that off myself? Department of Education holds my loans.
Message 94 of 98
Established Member

Re: TPD Loan forgiveness with VA disability rating.

All of your Loan will be Discharged to include the Interest. It will be backdated from the date you become Permanent and Totally Disabled. According to the new law: “As of January 2018, discharged student loan debt is no longer considered income. Any student loan debt that is discharged due to death or total and permanent disability (TPD) is no longer taxable.
Make note that this is not a retroactive law. awarded TPD student loan discharge during the 2017 tax year will still have to pay taxes come April 2018. The new law covers eligible loans discharged from January 1, 2018 to December 31, 2025”.
Message 95 of 98
New Member

Re: TPD Loan forgiveness with VA disability rating.

Right, I got my 100% in March of 2018 but how I read it was that it’s not considered income for federal tax purposes, which is great but now I’m wondering about on the state level. That’s where I was gearing my question more towards, is it considered income for state taxes, not federal taxes.

I have yet to find any good information in the internet on it.
Message 96 of 98
Member

Re: TPD Loan forgiveness with VA disability rating.

So, the quick answer is no. If it was considered taxable by federal and/or state you would have received tax documentation in the mail by 31 January.
Message 97 of 98
New Visitor

Re: TPD Loan forgiveness with VA disability rating.

I am currently @ the "Application under review" stage with Nelnet for my federal loans =$27k

I am @ the "application recieved" stage w/ Navient for my private loans = $96k

 

100% VA TPD/P&T

 

has anyone had private loans discharged, supposedly its quicker than nelnet and the Federal Loans disability discharge process?

 

its only been two days since I filed both. I will update everyone when I get an update.

Message 98 of 98