The U.S. Department of Education said Wednesday it was clearing student debt for thousands of borrowers who attended a for-profit chain of colleges that made exaggerated claims about its graduates’ success in finding jobs.
The Biden administration announced it was approving 18,000 applications for loan waivers from former students from the ITT Technical Institute, a chain that closed in 2016 after the Obama administration imposed a series of sanctions. The new loan relief will settle more than $ 500 million in debt.
The move represents a step forward in the efforts of the Biden government to clear a backlog in the Borrower Defense Program, which grants loans to students who have been defrauded by their colleges. During the Trump administration, claims piled up that stalled the program and only started processing claims after a federal court asked to do so. There are now more than 100,000 lawsuits pending.
When the new action was announced, Minister of Education Miguel Cardona promised to continue to campaign for students who are deceived by their schools.
“Our action today will give thousands of borrowers a fresh start and the relief they deserve,” Cardona said in a statement. “Many of these borrowers have been waiting a long time for discharge and we need to work quickly to make decisions on behalf of those whose claims are pending.”
Another round of loan relief follows in March when the Department of Education paid off $ 1 billion in government student debt for 72,000 borrowers. These claims all came from former for-profit college students.
Borrower defense is one of several educational programs proposed by the Biden administration to reverse Trump-era policies. Cardona is hosting a series of hearings this month as its agency is considering changes to this and other policies.
The program was barely used until 2015 when the Department of Education received thousands of applications from former Corinthian college students. The chain of for-profit colleges recently closed after it was discovered that they lied to students about their placement rates.
After the collapse of Corinthian and other ailing for-profit colleges, the Obama administration tried to make it easier for students to cancel loans. But the revision was reversed by the Trump administration, which later made its own rules that made it harder to get relief. When the rules were changed, then Education Minister Betsy DeVos said it had become too easy to get loans.
Cardona began scratching DeVos’s rules in March when he repealed a formula that allowed the Department of Education to only partially exonerate loans to students whose claims were approved. All loan relief borrowers will now have their loans billed in full.
Many of ITT Tech’s 18,000 applications were approved after the Department of Education found the company lied about graduate career prospects. The agency said ITT has made “repeated and significant misrepresentations” about its ability to help students find jobs. In reality, many students said it was harder to find employment when they listed ITT on their résumés, the department said.
Other claims were approved after the department found ITT was misleading students about their ability to transfer course work to other colleges. Credits were rarely accepted elsewhere, according to the department, so students made “little to no progress” in their academic careers.
The borrowers will be informed of their entitlement approvals in the coming weeks, the agency said.
Copyright 2021 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed in any way without permission.
source https://collegeeducationnewsllc.com/loan-relief-granted-to-former-for-profit-college-students/
No comments:
Post a Comment