Answer

You would be disqualified if you had annual earnings from employment above the Poverty Guidelines for a family of two in your state.
Social security benefits is not considered as earning from employment. The Department only considers earnings from work performed. However, the Department may require you to provide documentation of the disability/retirement pay to show that the earnings were not from work.

Link to additional info
http://ifap.ed.gov/disabilitydischarge/borrowerprocess.html

Let me know if you have any question.

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.