Sens. Isakson, Reed introduce bill to wipe out student debt for disabled veterans


Legislation that would wipe out outstanding student loan debt for veterans who were permanently disabled in service was introduced in the U.S. Senate.

© Shutterstock

Currently, veterans who are deemed “totally and permanently” disabled by the U.S. Department of Veterans Affairs (VA) are eligible to have their student loan debt canceled. However, many veterans who qualify for this relief are not receiving it and may not even be aware of it. In 2018, the VA provided data to the Department of Education on veterans who would qualify, and then the Department of Education would alert eligible veterans of the debt relief.

However, the Department of Education reported this spring that of the more than 40,000 veterans who were identified as eligible for loan forgiveness had not submitted the required paperwork and, as a result, have not had their loans forgiven. Many of these individuals are currently in default on their loans.

The bill, introduced by Sens. Johnny Isakson (R-GA) and Jack Reed (D-RI), would require the U.S. Department of Education to automatically forgive loans of veterans who were determined by the VA to be 100 percent disabled or individually unemployable.

“This is a commonsense way to make it easier for totally and permanently disabled veterans to receive the student loan relief they deserve, and I hope that we’re able to act quickly on it,” Isakson, chairman of the Senate Committee on Veterans’ Affairs, said.

The bill would require the Department of Education and the VA to conduct a computer-matching program at least twice a year of individuals who would qualify. Further, it would require the departments to work together to address minor discrepancies in the data to ensure that no veteran falls through the cracks due to a clerical error. Finally, it would require the Department of Education to forgive student loans for individuals who qualify automatically.

The bill is supported by several veterans organizations, including Iraq and Afghanistan Veterans of America, High Ground Advocacy, Student Veterans of America, the Retired Enlisted Association, Veterans Education Success, and the U.S. Army Warrant Officers Association.

A companion bill was introduced in the U.S. House of Representatives by Reps. Conor Lamb (D-PA) and Brian Fitzpatrick (R-PA).

The post Sens. Isakson, Reed introduce bill to wipe out student debt for disabled veterans appeared first on Financial Regulation News.