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New Jersey AG calling for automatic discharges of student loans for permanently disabled veterans

TRENTON, NJ – Attorney General Gurbir S. Grewal announced that he is co-leading a bipartisan group of 52 State and Territorial Attorneys General in urging the U.S. Department of Education (USDOE) to automatically forgive the student loans of veterans who became totally and permanently disabled in connection with their military service.

Attorney General Grewal co-led the coalition with Utah Attorney General Sean Reyes, and they unveiled their efforts together as the country prepares to honor fallen troops on Memorial Day. 

“Today we stand with our veterans who put their lives on the line for their country and are now disabled due to their service,” said Attorney General Grewal. “All Americans should agree that these veterans do not deserve to be saddled with student loan debt. Congress has already decided that their loans should be forgiven. Now we need to cut through the red tape standing in the way. It’s the right thing to do, and it’s the least we can do to honor our veterans’ service.”

Last year USDOE identified more than 42,000 veterans as eligible for student loan relief due to a service-related total and permanent disability, the Attorneys General note in a letter to Secretary of Education Betsy DeVos. Fewer than 9,000 of those veterans had applied to have their loans discharged by April 2018, however, and more than 25,000 had student loans in default.

The multi-state letter calls on USDOE to develop a process to automatically discharge the student loans of veterans determined by the Department of Veterans Affairs to be eligible for such relief. While the automatic discharge process is in development, the letter proposes, USDOE should halt debt collection efforts targeting disabled veterans, and clear their credit reports of any negative reporting related to their student loans. 

Under federal law, USDOE is required to discharge the federal student loans of veterans determined by the Department of Veterans Affairs to be unemployable (or “totally and permanently disabled”) due to a service-connected condition. Although USDOE currently requires disabled veterans to take affirmative steps to apply for a loan discharge, those steps are not required by law.

The Attorneys General note that the federal government has taken some steps to make it easier for eligible veterans to secure student loan relief. According to their letter, however, an automatic discharge process that gives individual veterans an opportunity to opt out for personal reasons “would eliminate unnecessary paperwork burdens and ensure that all eligible disabled veterans can receive a discharge.”

The letter supporting automatic student loan discharges for totally and permanently disabled veterans received support from enough Attorneys General to become formal policy of the National Association of Attorneys General. This designation is reserved for letters and comments supported by at least 36 Attorneys General.

“Proposals for automatic discharges with opt-out rights have bipartisan support in Congress and among leading veterans’ advocacy organizations,” the letter states. The veterans groups supporting such proposals have included: Vietnam Veterans for America, Veterans Education Success, The Retired Enlisted Association, High Ground Advocacy, and Ivy League Veterans Council.

The letter closes by urging USDOE to “take action to better protect those who once protected the nation. Our veterans deserve nothing less.”

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By: Jay Edwards Follow on Twitter | Like on Facebook

New Jersey’s Attorney General Gurbir S. Grewal headshot at the Hughes Justice Complex in Trenton, N.J. on Monday, Jan. 22, 2018. (Office of Attorney General / Tim Larsen)

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