President Trump signed an executive order Wednesday that totally wipes out all student loan debt for all permanently disabled U.S. military veterans.
“The debt of these disabled veterans will be completely erased,” Trump said. “That’s hundreds of millions of dollars of student loans debt for our disabled veterans that will be completely erased.”
The executive order, which Trump signed following a speech at the American Veterans National Convention in Louisville, Kentucky, also clears those eligible veterans from having to pay any federal income tax on the loans. Trump added that he is pressuring individual states to follow suit.
Fox reports: The memo Trump signed directs the government to develop an “expedited” process so veterans can have their federal student loan debt discharged “with minimal burdens.” Currently, just half of the roughly 50,000 disabled veterans who are qualified to have their federal student loan debt forgiven have received the benefit because of a burdensome application process.
Under the current process, disabled veterans can have their debt forgiven under a loan forgiveness program, called Total and Permanent Disability Discharge, or TPD, as long as they have a VA service-connected disability rating of 100 percent. As of July, however, only about 20 percent of the eligible pool of veterans had taken advantage of the program due to the complicated nature of the application and other factors.
Trump’s announcement comes days after the administration hired a longtime student loan industry executive to be the federal government’s top watchdog for the student loan market. Robert Cameron will serve as the Consumer Financial Protection Bureau’s new student loan ombudsman, the bureau said Friday.