Federal Student Aid’s Total and Permanent Disability Discharge Process

We found, based on our review of samples of approved and rejected TPD discharge applications, that FSA appropriately approved and rejected the applications. We determined that FSA applied appropriate criteria to approve and reject individual TPD discharge applications in accordance with Federal program requirements. We also found that Nelnet generally serviced those TPD accounts throughout the TPD discharge process in accordance with Federal program requirements.2 In addition, based on our review of FSA’s processes and samples of TPD discharge applications, we determined that FSA ensured that accurate information on student loan discharges was entered into the TPD databases.Although we found that FSA appropriately approved or rejected applications, we identified design weaknesses in FSA’s control activities for the TPD discharge application review process that may negatively affect the operating efficiency and effectiveness of the process and increase the risk that FSA approves applications that are inaccurate or incomplete. In addition, we found weaknesses in FSA’s documented procedures and its quality control review for its TPD discharge application review process. We also found weaknesses in FSA’s monitoring of the TPD discharge process.