Sallie Mae Launches Initiative to Educate Customers, Medical Professionals on Loan Cancellation Process for the Disabled

Web Site, Enhanced Service Options Help Customers

Navigate Federal Requirements

Dec 16, 2005, 00:00 ET from Sallie Mae

    RESTON, Va., Dec. 16 /PRNewswire/ -- Sallie Mae today announced the
 creation of a new customer service initiative to better help borrowers with
 disabilities or debilitating illnesses -- and their physicians -- fully comply
 with federal regulations pertaining to the cancellation of loans issued
 through the Federal Family Education Loan Program (FFELP).  These resources
 will assist borrowers as they navigate the FFELP loan discharge process and
 complete the forms required by the U.S. Department of Education in an
 efficient and effective manner.
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     "While disability discharge affects a very small number of individuals, it
 affects them profoundly.  Our goal is to make this process as easy and hassle-
 free as possible for those who need this federal student loan benefit," said
 June McCormack, executive vice president of servicing, information technology,
 and sales marketing.  "This is just one example of how every day we try to be
 flexible and responsive to all of our customers' needs."
     By law, certain qualified borrowers who become totally and permanently
 disabled or whose disabilities worsen over time are permitted cancellation or
 "discharge" of the borrower's (and if applicable, any endorser's) obligation
 to repay the remaining loan balance.  Unfortunately, filling out the paperwork
 required by the federal government to participate in the disability discharge
 process can be a complicated and burdensome task, particularly for individuals
 who are struggling with severe health problems.  Inaccuracy or incompletion
 are the major causes of unnecessary -- and avoidable -- delays and rejections.
     As part of this disability discharge educational campaign, Sallie Mae has
 created a disability discharge Web site for borrowers and physicians,  This free tool is designed
 to walk borrowers step-by-step through the application process, and help
 physicians complete the required documents in an accurate and timely manner.
 The Web page provides users with answers to the most commonly asked questions
 regarding the federal disability discharge process.  Borrowers and doctors can
 go to the page to download the Department's official Loan Discharge
 Application for Total and Permanent Disability, and to view a sample form that
 has been completed properly.
     Sallie Mae has also updated and clarified the correspondence it issues to
 borrowers who contact the company for guidance on this issue, and the
 company's customer service staff has received in-depth training on the federal
 disability discharge process and on the best way to counsel borrowers who call
 with questions.
     "The financial aid office sometimes receives questions from student
 borrowers who believe they may qualify for loan discharge due to disability,
 and guiding them through that process can be confusing," said Linda F. Bell,
 director of financial aid at Lehigh University in Bethlehem, Pa.  "I'm pleased
 Sallie Mae has developed this free resource for disabled borrowers that
 provides guidance as well as the appropriate forms."
     Potential beneficiaries of a federal disability discharge should be aware
 that the Department of Education has its own rules and applications for
 disability benefits; meeting the eligibility criteria for Social Security
 benefits does not automatically qualify a borrower for discharge of his or her
 student loan.  To be eligible for this discharge, the borrower must provide
 certification of his or her total and permanent disability (defined as "a
 condition that keeps you from working or earning money because of an injury or
 illness that is expected to continue indefinitely or result in death") from a
 doctor of medicine or osteopathy licensed to practice in the U.S.  One major
 reason that applications for discharge are rejected is that doctors fail to
 fully and accurately complete the application.  Therefore, the Web site also
 provides a detailed instructional checklist of issues for physicians to take
 into consideration when filling out the Department's official loan discharge
 application.  In particular, it is important that a doctor state not only the
 patient's diagnosis, but also provide a detailed explanation of how the
 illness prevents the patient from working.
     Borrowers should note that to be eligible for discharge under federal
 regulation, his or her condition must not have existed at the time the loan
 was made, unless the condition has substantially deteriorated so that he or
 she is now totally and permanently disabled.
     Borrowers in need of additional assistance are encouraged to contact
 Sallie Mae directly at 888/272-5543, visit the company's disability discharge
 Web site at, or log on to the
 Manage Your Loans section of to review loan status
 and email questions to Sallie Mae.
     SLM Corporation (NYSE:   SLM), commonly known as Sallie Mae, is the nation's
 No. 1 paying-for-college company, managing nearly $121 billion in student
 loans for 8 million borrowers.  Sallie Mae was originally created in 1972 as a
 government-sponsored entity (GSE) and terminated all ties to the federal
 government in 2004.  The company remains the country's largest originator of
 federally insured student loans.  Through its specialized subsidiaries and
 divisions, Sallie Mae also provides debt management services as well as
 business and technical products to a range of business clients, including
 colleges, universities and loan guarantors.  More information is available at  SLM Corporation and its subsidiaries are not
 sponsored by or agencies of the United States of America.

SOURCE Sallie Mae