Discharge Of My School Loans Due To Medical Reasons

I just wanted to start a thread for people who are going through this. Due to medical reasons (that I will not elaborate on) my student loans will be cancelled out. My lender Sallie Mae has this program that if you qualify will discharge your loans. I was very excited when this past Thursday (May 24, 2012) my doctor signed the papers that will get the process started. Yippie! Anyone in a similar situation that cares to discuss?

P.S. Not sure where I was suppose to post this.

 

Then you have to pay a huge amount in taxes yeaaaaaaaaaaaaaaaa.

They don't have real nice payment plans though.

 

Cancelled Student Loan Debt Creates Tax Nightmare | Credit.com News + Advice

Got rid of 91K but now has to pay 26K to the IRS and a nice chunk to the state.

 

Oh wow I did not know this...glad I am discussing it and glad you are bringing this to light. Hopefully, I will not have to pay this tax...but at least I know of it now.

My loan about was HUGE...close to maxing out...so paying ALL that VS. paying a portion in taxes, sounds better to me. I guess I will cross that bridge when I get there Thanks!

 

What is your loan amount being discharged?

 

Over 100K...I believe 138K is the max (I could be wrong)...so with interest and things like that...I am up there.

 

To be honest, I lost count because now Sallie Mae divides up the loans, and all these different policies apply and higher interest rates. It could be more. It's not more than 150K though. I have Grad Plus Loans too. It is just a mess. One huge mess...so having this cancelled out is fantastic. Paying taxes, is not so much fun, but again...I will have to deal with that when I get there.

 

Crazy you're in the type of debt, with just an MBA. Good luck with it all, adding another 50-100K on for an Doctorate would be crazy

 

Yes it would be crazy to add on more debt. But honestly this discharge news is new (just this past week) so I MIGHT NOT go for the Doctorate in Ministry since technically I do not really need it, and also I cannot afford it. I am not sure I can take out more loans after they discharge. At any rate, I would NOT WANT to take out student loans after this discharge goes through. That would be unwise. So there is A LOT to think about in light of this new news. Thank you for all your help b4cz28

 

I'm sorry to hear you are going through this, and hope that the Sallie mae program works for you. However, last week you posted a thread about a Doctorate in Ministry. With being so in debt, and not being able to afford your current loans, why would you even contemplate another degree knowing you can't pay for the first one?

I am not trying to be mean, just trying to understand.

 

I did not think I would get approved for the discharge at all. My doctor said it would be no problem at all for him to sign the papers. So since I did not plan it, I was just thinking I would do the Doctorate as usual. I have some room in my loans maybe 20K or so.....so I was looking for something cheap....I have seen some Doctorate Degrees in Ministry as low as $4,000 (but obviously not accredited). So I did not know what was going to happen. Hopefully that answers your questions

 

Holly hell, that's some serious debt. I got through my associates and my bachelors (thanks to the GI Bill) and all I owe is around $4,600 in federal student loans.

 

I think somebody is messing with us....

 

NOW I'm sure of it. :bsflag:

 

Okay, you had low GPA's for your previous degrees. Now, you are trying to default your student loans over $100k. And you are going to seek for a Doctorate degree? Well, you need reality check; and my recommendation to you is staying off school.

 

If I where you then this would be my main concern. If you can get a doctorate for 4k and not borrow money than I don't see that as a bad thing. I'm not really sure why you would want to do that though. This link says you can take out a student loan after you have your debt discharged BUT...that would be a horrible idea (plus you won't be able to discharge that). Word of warning though..."don't count your chickens before they have hatched". To my understanding a medical discharge is CRAZY hard to get. Your doctor may have started the paperwork but it is yet to be finished. Either way your it looks like your going to have to pay at least 25k to the IRS.

 

It's not defaulting. The program is called Total and Permanent Disability Discharge and it's a federal student loan forgiveness program for people who have become permanently disabled. There is no financial hardship requirement to qualify. But, they DO make you prove your disability, and it's not easy. If you're approved there is a 3 YEAR "monitoring" or "conditional discharge" period before the loans go away. It's not instant. This process is not a walk in the park at all.

 

IRS form 982 can be filed to make the taxes go away.

 

Hey, congrats (I think). Is is no strings attached? What if you become rich in 10 years...do you have to pay it back? I've never heard of someone being forgiven loans because of medical issues. Only cases I've heard of are bankruptcy or if you get a teaching credential and teach then the gov't will forgive your student loans...