Until July 1, 2023, borrowers approved for TPD discharge based on SSA documentation or a physician’s certification are subject to a 3-year post-discharge monitoring period to verify continued eligibility.
During the monitoring period, borrowers must inform their loan servicer of any changes in their annual earnings and employment status. They cannot engage in “substantial gainful activity,” meaning their annual earnings must not exceed the poverty guideline amount for a family of two in their state, regardless of actual family size. Borrowers must also share their scheduled disability reviews by the SSA with their loan servicer.
Loans and obligations can be reinstated if borrowers fail to meet eligibility requirements. Loss of eligibility can occur if:
Annual earnings surpass the poverty guideline amount for a family of two in your state.
You obtain a new federal student loan or TEACH Grant and don’t return the funds within 120 days of disbursement.
You no longer have a disability, or your next scheduled disability review occurs sooner than 5 to 7 years from the last SSA disability determination.
Eliminating the monitoring period
Starting July 1, 2023, the Department of Education will remove the three-year post-discharge income monitoring period, streamlining the process and reducing the administrative burden on borrowers.
This change enables borrowers who receive TPD discharge to concentrate on their well-being and financial stability without concerns about ongoing income monitoring requirements.
The Education Department released these rules, which will take effect on July 1, 2023, as specified in the Higher Education Act.