Editorial: Loan forgiveness for Americans with disabilities must continue progress

The Obama administration is working to assure student debt doesn’t gridlock any person with a disability.

On Tuesday, the president announced plans to forgive $7.7 billion in federal students loans for nearly 400,000 permanently disabled Americans. By law, Americans with permanent disabilities are eligible for loan forgiveness and always have been eligible.

Although Americans with disabilities have always been eligible for loan forgiveness, the Obama administration took steps four years ago to make the process easier. Those with permanent disabilities were able to use their Social Security designation to apply for the loan discharge, but few took advantage.

Starting next week, borrowers identified in the matching program — which the Social Security Administration created — will begin receiving letters from the government explaining how to receive discharge to ensure all Americans eligible are aware of their options.

This is an essential first step in reaching Americans with disabilities and relieving them of the thousands of dollars of loans that often cause financial strife.

But we can advance this further to ensure no American with disabilities falls through the cracks, and Americans who were eligible but weren’t aware are forgiven of their default.

To ensure the loan relief program is executed as efficiently as possible, the government should reach everyone who is eligible by accounting for the logistical issues. By sending officials skilled in filling out the discharge application and mailing it, we can avoid having Americans with disabilities default on their loans, which the SSA has shown to be a frequent occurrence.

In the agency’s first review, 179,000 of the 387,000 people who were deemed eligible to receive discharges were in default on their loans, putting them at risk of losing their tax refunds and Social Security benefits — benefits borrowers need to survive.

As Persis Yu, the National Consumer Law Center’s student loan borrower assistance project director, told the Washington Post, this program is only the first step.

“The administration needs to go further to ensure that no borrower who has a right to student loan relief has their benefits taken,” Yu said.

The 179,000 people who defaulted on their loans because they didn’t know they were eligible for discharges shouldn’t be at risk of losing critical Social Security benefits or tax refunds.

Thousands of Americans with disabilities rely on these Social Security benefits and tax refunds to survive, and the government needs to make sure that they don’t continue paying the price for loans they didn’t have to pay for in the first place.

“Borrowers receiving SSDI need these payments to survive,” said Yu.

Forgiving student loans for people with permanent disabilities does more than just give people a chance to rise above debt. It may cost taxpayers $7.7 billion now, but it could save taxpayers more in the future.

According to a Census Bureau report from 2013, 30 percent of welfare recipients are disabled.

According to the Social Security Administration, every month, the federal government also grants 14 million Americans disability, spending more money each year on cash payments for disabled former workers than it spends on food stamps and welfare combined.

If we were to pay off the loans of those who are disabled now, they’re less likely to fall into the vicious cycle of unemployment and poverty that goes along with debt.

Obama’s loan forgiveness plan provides Americans with permanent disabilities the opportunity to pursue the careers they had attended school to pursue with a clean, debt-free slate.

Americans with disabilities have a right to student loan relief, and it’s time to make sure they have access to the benefits they are due.