Student Loan Forgiveness: Biden Administration Makes It Easier for Those Misled by Schools to Have Debt Erased

Democratic National Committee Winter Meeting Reception, Philadelphia, USA - 03 Feb 2023
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With its plan to cancel federal student loan debt for millions of borrowers still hung up in the courts, the Biden administration has set its sights on another way to provide debt relief. This strategy aims to make it easier for borrowers to have their student loan debt erased if they’ve been misled by colleges and universities.

The initiative was unveiled on a new webpage launched by the U.S. Department of Education’s Federal Student Aid agency, under the heading of “Borrower Defense Loan Discharge.” The page provides detailed steps you can take toward a “borrower defense to repayment,” which basically means you have legal grounds to discharge federal student loans if your school misled you or engaged in other misconduct in violation of certain laws.

If the Education Department approves your application for borrower defense, it will discharge any remaining balance on the federal student loans you took out to attend the school. The department might also refund loan payments you already made.

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To submit the strongest borrower defense application possible, the Education Department advised putting these two things in your application:

  1. As much detail as possible to help it evaluate your claim(s)
  2. Address all required elements of a borrower defense claim

As CNN reported, borrowers who’ve been misled by colleges have long had the right to request loan forgiveness, but the application process wasn’t clearly established until the Obama administration. The latest change offers clearer and more comprehensive information about how to apply.

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“The new borrower defense webpage is filled with guiding language and tips to help borrowers successfully complete their applications and get the loan relief to which they are entitled,” Richard Cordray, Federal Student Aid’s chief operating officer, said in a statement to CNN. “For all those who lost time, money and the promise of an education, we will continue to work to make them whole.”

The Education Department has already erased billions of dollars in student debt for borrowers who were misled by for-profit schools such as ITT Technical Institute and DeVry University. While those colleges have gotten most of the attention, the borrower defense loan discharge is not restricted only to for-profit schools.

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Since President Joe Biden took office, the Department of Education has canceled about $14.5 billion in student loan debt under the borrower defense program, CNN noted. Nearly 1.1 million borrowers have gotten relief thanks to the program.

That represents a major shift from the Trump administration, whose education secretary, Betsy DeVos, called borrower defense “bad policy.” Among her criticisms was that taxpayers are forced to foot the bill for student debt forgiveness.

Many Republican lawmakers also oppose the Biden administration’s aggressive pursuit of student loan forgiveness — including its plan to cancel up to $20,000 in federal student loan debt per borrower. That plan has been delayed due to a series of lawsuits challenging its legality. Cases tied to the plan are currently being heard by the U.S. Supreme Court.

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More: Will Ending the National COVID Emergency Affect Biden’s Plan?

For more information on the Borrower Defense Loan Discharge, visit the Federal Student Aid page.

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About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.
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