Veterans using Chapter 31 Vocational Rehabilitation and Employment (VR&E) often do not need to take out federal student loans in the first place, because VR&E can pay tuition, fees, books, supplies, and a monthly subsistence allowance directly, depending on the approved rehabilitation plan. Before applying for any federal loans, it is worth confirming with your assigned VR&E counselor exactly what costs your plan covers, since VR&E funding varies based on your individualized plan and the school's tuition and fee structure. If VR&E covers your costs in full, there may be no need to borrow at all.
Separately, veterans who are rated 100% Permanent and Total (P&T) by the VA may qualify for discharge of existing federal student loans through the Department of Education's Total and Permanent Disability (TPD) discharge program, governed by 34 CFR 685.213. This is different from VR&E funding — it is a way to have federal loans already taken out (Direct Loans, FFEL, or Perkins Loans) forgiven based on disability status. The Department of Education periodically performs a data match with the VA to identify veterans who may be eligible, but veterans do not have to wait for that match; they can apply directly at studentaid.gov, or by mailing an application to Nelnet, the servicer that manages the TPD discharge process, along with documentation of a 100% P&T rating from the VA (such as a decision letter or disability compensation award letter showing permanent and total status).
Official 2026 VA monthly compensation, including the 2.8% COLA increase.
Dependent add-ons start at a 30% rating. Child-only and dependent-parent rates: see the full 2026 pay chart.
| Rating | Monthly (2026, incl. 2.8% COLA) |
|---|---|
| 10% | $180.42 |
| 20% | $356.66 |
| 30% | $552.47 |
| 40% | $795.84 |
| 50% | $1,132.90 |
| 60% | $1,435.02 |
| 70% | $1,808.45 |
| 80% | $2,102.15 |
| 90% | $2,362.30 |
| 100% | $3,938.58 |
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Analyze my claim free →It is important to understand that if you accept a TPD discharge, there can be a three-year monitoring period during which certain events, such as new federal student loan disbursements or earnings above a threshold, can reinstate the discharged debt. This is worth discussing with the loan servicer before applying, especially if you plan to take out new federal loans for the same enrollment period.
Because VR&E funding and TPD loan discharge are two separate systems with different rules, a veteran in this situation should not assume one automatically affects the other. The clearest next step is to schedule time with your VR&E counselor to confirm what your VR&E plan will and will not pay for, and separately contact studentaid.gov or your loan servicer to ask about TPD discharge eligibility using your VA P&T rating documentation.
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