100% P&T Federal loan forgiveness

My wife is 100% P&T and is using her GI bill benefit. She goes to school with other vets and one of them has mentioned the ability for a one time federal loan forgiveness. It sounds too good to be true, and after receiving additional word of mouth advice--sounds sketchy. Her tuition is fully covered with yellow ribbon and receives her full BAH. What I am being told is that you can take out a max of 20k a year in federal loans, and defer the payments and deny the one time payout until graduation and then use your one time forgiveness. Where it got strange was what our understanding leaving the conversation was that if we took federal loans, the loans would go towards tuition first, and then when the VA goes to pay and sees it is settled, she is issued the payment directly. If someone can please help me make sense of what is allowed and the general process it would be much appreciated.