Saturday, March 11, 2023

Biden has Quietly Forgiven Billions in Student Loans Despite Setbacks for His Signature Debt Plan; Report: Biden Admin has Forgiven Billions in Student Loan Debt Despite Problems With Plan

Kent Nishimura / Los Angeles Times
Biden has quietly forgiven billions in student loans despite setbacks for his signature debt plan:
Sara Diaz was feeling emotional when she checked her email Tuesday. She was among the hundreds of Neiman Marcus employees laid off last month and had just finished a stressful phone call about her health insurance.
As she went through her inbox, she noticed an email from the Department of Education. Diaz had applied to have the government cancel $69,314 in federal student loan debt she took on to attend the Art Institute of Pittsburgh, a for-profit school that closed in 2019.
Two and a half years, two Education secretaries and one class-action lawsuit later, her application had finally been approved.
“I almost couldn’t believe it,” she said. “I reread it probably five times.”
For decades, a lesser-known program for federal student loan recipients has allowed borrowers to assert a defense to repayment if a school misled them or broke state law. Since the Education Department introduced a formal application in 2015, more than 770,000 people have applied. Nearly half a million applications were still pending at the end of January.
After a modest start at the tail end of the Obama administration, the program stagnated under former President Trump. But under President Biden, the Education Department has ramped up processing borrower defense applications, overhauled the regulations governing the program and used it to cancel billions in debt for people who attended for-profit schools accused of defrauding students --->READ MORE HERE
Biden admin has forgiven billions in student loan debt despite problems with plan: report
Despite fights with Congress over canceling student loan debt, the Biden administration has quietly forgiven billions of dollars in loans over the years.
Through a lesser-known program for federal student loan borrowers, recipients can ask for loan forgiveness if a school misled them or broke state law, the Los Angeles Times reported. Since the formal application was introduced in 2015, more than 770,000 people have applied and nearly half a million were pending as of January.
The program itself stagnated under former President Trump but has ramped up under Biden's watch.
Sara Diaz applied to have her $69,314 in loans forgiven after taking on the debt to attend the Art Institute of Pittsburgh, a for-profit school that closed in 2019. After 2.5 years, she received an email notifying her that her application had been approved.
"I almost couldn't believe it," she told the Times. "I reread it probably five times."
The strategy to forgive the debt comes as Biden faces an uphill battle to cancel up to $20,000 in debt for some borrowers. The Department of Education has forgiven more than $18 billion for borrower defense applicants and for those whose schools closed before they finished their degrees.
The for-profit school industry has long been criticized for its recruiting practices and the quality of education its student receives. --->READ MORE HERE
If you like what you see, please "Like" and/or Follow us on FACEBOOK here, GETTR here, and TWITTER here.

No comments: