TPD Discharge Processing Has a New Home: What Schools and Loan Holders Need to Know

Earlier in April, The U.S. Department of Education posted an Electronic Announcement affirming that it has officially completed its transition of the Total and Permanent Disability (TPD) Discharge process to StudentAid.gov. This shift, effective as of March 23, 2025, is part of the broader rollout of the Unified Servicing and Data Solution (USDS), which is the Department’s effort to streamline federal loan servicing for borrowers and stakeholders alike. For borrowers, this move promises a more user-friendly, transparent process. For schools, guaranty agencies, and other loan holders, however, this transition brings important operational updates and a few key action items. In this article, we break down what this means and what you need to do moving forward.

What’s Changed—and What Hasn’t

First, it’s important to note that the basic regulations governing TPD discharges haven’t changed. The criteria for discharge, borrower documentation, and eligibility remain the same. However, the administration of the process has shifted entirely to the Department of Education via StudentAid.gov. Borrowers can now submit their TPD documentation and track their discharge status directly on the website—making things significantly easier from the borrower perspective.

As part of the transition, all TPD discharge processing—including loan assignments—was placed on temporary hold in late 2024. That pause is now over. As of

March 23, 2025, TPD discharge processing has resumed.

A New Federal Loan Servicer (Sort Of)

While the Department has confirmed that a new TPD Federal Loan Servicer will be responsible for managing TPD assignments, they haven’t yet publicly announced the name of that servicer. That means schools and guaranty agencies (GAs) should not transfer any loans just yet. Instead, continue to hold on to:

• Any TPD assignments in your possession since Dec. 20, 2024
• Any TPD assignments that were rejected by the previous servicer between Dec. 20, 2024 and Feb. 9, 2025

FSA anticipates sharing more details on when assignments can be transferred—and to whom—in the coming weeks.

Back in Action: Communicating with Borrowers

Now that TPD discharge processing is active again, it’s crucial that loan holders update their communications. If a borrower reaches out with questions about TPD, you can now affirm that the pause is over and refer them to StudentAid.gov/disabilitydischarge for next steps. You can also direct them to the TPD Discharge Support Line at 1-888-303-7818.

New Format for Loan Holder Notification (LHN) Files

As part of the system shift, there are two big changes to how TPD Loan Holder Notification (LHN) Files are sent out:

1. New SAIG Mailbox: The LHN Files will now be transmitted from a new Student Aid Internet Gateway (SAIG) mailbox—TGEE778. Make sure your systems are configured to recognize this mailbox so you don’t miss important updates.
2. SAIG-Only Distribution: Email delivery of LHN Files is officially a thing of the past. Going forward, all loan holders must be enrolled in SAIG to receive LHN Files. If you haven’t already signed up or need help setting this up, contact the FSA Partner and School Support Help Desk at 1-800-330-5947 or email support@fps.ed.gov.

Even though the file format, field names, and business rules haven’t changed, ensuring you’re set up to receive them properly is essential to staying compliant and serving borrowers well.

What This Means Moving Forward

This transition to StudentAid.gov is another step in FSA’s effort to centralize and modernize its loan servicing environment. For borrowers with disabilities seeking relief from federal student loan debt, the process is becoming clearer and easier to navigate. For loan holders and school partners, it’s a reminder of the need to stay nimble, informed, and ready to pivot as new servicing platforms and procedures roll out.

In the meantime, staying connected to electronic announcements and ensuring your back-end systems are aligned with SAIG requirements will go a long way in ensuring a smooth process for everyone involved.

Have questions or concerns about this transition? HEAG is here to help. Whether you’re navigating compliance, reconfiguring your system setup, or updating your staff on TPD procedures, you can contact info@heag.us so that our experts can provide the support you need with this and other issues.