How to Fill Out the Loan Rehabilitation Income and Expense Form

To fill out the Loan Rehabilitation Income and Expense form, you report your household’s monthly income, monthly expenses, and family size so the Department of Education can set a payment lower than the standard 15 percent of discretionary income formula would produce. The form has four sections, takes about an hour if your documents are in order, and can bring your required payment down to as little as $5 per month.¹²

Gather Your Documents First

You do not have to attach proof of every line item when you submit, but the loan holder can request supporting documentation for anything on the form, and your rehabilitation request is void if you miss their deadline for providing it.³ Pulling everything together before you start the form saves you from scrambling later.

For income, acceptable proof includes a recent pay stub or a letter from your employer stating your earnings. For child support, Social Security, workers’ compensation, or public assistance, you can use copies of benefits checks, a benefits statement, or a letter from the paying agency or individual specifying the amount.³ You will also need your most recent IRS Form 1040 (signed by hand) or your latest tax transcript to confirm your adjusted gross income and family size.²

For expenses, pull recent bills or statements for anything that makes up a large share of your budget: rent or mortgage, utilities, medical costs, child care. The loan holder gets to decide whether any expense you claim is reasonable and necessary, so documentation matters when a number looks high.³

Filling Out the Form, Section by Section

If you are completing the paper version, use dark ink and print clearly. Dates go in month-day-year format using only numbers. Write your name and the account numbers for your defaulted loans on any documentation you send with the form.³

Section 1: Borrower Information

Enter your Social Security number, full name, mailing address, and phone numbers. An email address is optional but worth providing because it gives the Department a faster way to reach you about your agreement. Check the box at the top of the section if any of your information has changed since your loan holder last had it on file.

Section 2: Monthly Income and Expenses

Items 1 through 9 cover income. Report the monthly amount for each source:

Item 1: your employment income.
Item 2: your spouse’s employment income.
Items 3 through 7: child support received, Social Security benefits, workers’ compensation, public assistance (list each type), and any other income (describe it).
Item 8: add items 1 through 7 for your total monthly income.
Item 9: if your total is zero, explain how you support yourself.

Do not skip item 9 if it applies to you. A blank explanation when you have reported zero income will prompt the loan holder to send the form back for more information.

Items 10 through 22 cover expenses. For each category, enter what you typically spend per month:

Items 10 through 13: food, housing, utilities, and basic communication (phone and internet).
Items 14 through 16: necessary medical and dental costs, necessary insurance, and transportation (include the number of vehicles you use).
Items 17 and 18: child or dependent care, and any court-ordered child or spousal support you pay.
Items 19 and 20: monthly payments on federal student loans and private student loans that are not in default.
Item 21: other necessary expenses not covered above. Describe them. The form notes these expenses only count if the Department determines they should.³
Item 22: add items 10 through 21 for your total monthly expenses.

Do not double-count. If your car insurance is part of your transportation cost on item 16, do not list it again under insurance. Enter zero for any category that does not apply rather than leaving the line blank.

Section 3: Family Size

Item 23 asks for the number of people in your household. Family size includes you, your spouse if you file taxes jointly, your children who receive more than half their support from you, and any other individuals who live with you, receive more than half their support from you, and will continue to for the year.⁴ This number matters because a larger family size raises the poverty-guideline threshold used to calculate discretionary income, which lowers your payment.

Item 24 asks whether you are rehabilitating a joint consolidation loan made to you and your spouse. If yes, provide your spouse’s name and Social Security number. Most borrowers will check “No” and move on.

Section 4: Certification and Signature

By signing, you certify that everything on the form is true and that you will provide additional documentation if your loan holder asks for it.³⁵⁶ Date and sign.

Where to Send the Form

Send the completed form and any supporting documents to the Department of Education’s Default Resolution Group by mail or fax:²

Mail: U.S. Department of Education, Default Resolution Group, P.O. Box 5609, Greenville, TX 75403-5609.
Fax: 1-240-931-3323.

If your loans are held by a guaranty agency or a private collection agency rather than directly by the Department, check with that holder. They may have their own portal or mailing address, which is listed in Section 8 of the form you received.

Keep copies of everything: the signed form, every supporting document, and your fax confirmation page or mailing receipt. If anything is lost in transit, your copies are the only proof you submitted on time.

What Happens After You Submit

The Department initially sets your reasonable and affordable payment at the same amount you would owe under an income-based repayment plan. If that figure comes out below $5, your payment is $5 per month. The regulation prohibits basing the payment on a flat minimum, a percentage of your total loan balance, or any other number unrelated to your actual financial circumstances.¹

Within 10 business days of receiving your information, the Department will mail you a written rehabilitation agreement and update your account on MyEdDebt.ed.gov.² The agreement will state your monthly payment and explain your right to object orally or in writing within the timeframe it specifies. If you first gave income and expense figures over the phone, the Department can start the process using those numbers, but you still have to submit documentation to confirm your AGI and family size. Missing the Department’s deadline for that documentation voids the entire agreement.¹

One Rehabilitation per Loan

Federal law currently limits rehabilitation to one time per loan. If you rehabilitate a loan and then default on it again, you cannot use rehabilitation a second time on that same loan, so it is worth taking the time now to report your income and expenses as accurately as possible and to set a payment you can actually sustain. A statutory amendment scheduled to take effect on July 1, 2027, will raise the limit to two times per loan, but that change is not yet in effect.⁷

1
eCFR. 34 CFR 685.211 – Miscellaneous Repayment Provisions
2
Federal Student Aid. Student Loan Rehabilitation for Borrowers in Default: FAQs
3
Federal Student Aid. Loan Rehabilitation Income and Expense Form
4
eCFR. 34 CFR 685.209 – Income-Driven Repayment Plans
5
Office of the Law Revision Counsel. 18 U.S. Code 1001 – Statements or Entries Generally
6
Office of the Law Revision Counsel. 18 USC 3571 – Sentence of Fine
7
Office of the Law Revision Counsel. 20 USC 1078-6 – Default Reduction Program