208K borrowers will have $3.9B in student debt discharged

(The Hill) – The Department of Education on Tuesday announced plans to eliminate $3.9 billion in federal student loans for 208,000 borrowers in the latest relief round.

The office said the reduction will be applied to all remaining federal student loans that borrowers received to attend ITT Technical Institute, which closed in September 2016, from January 2005 onwards.

“This includes borrowers who have not applied for borrower defense to make payments. These borrowers will have the federal student loans they received to attend ITT released without additional action on their part,” the agency announced Tuesday morning.

The move follows an earlier decision by the administration to approve loan waivers for borrowers to attend ITT, after the office said the institution was found to “engage in widespread and pervasive abuses related to students’ ability to obtain employment or transfer credits.”

The department also accused the institute of “lying about the program’s accreditation of the ITT associate degree in nursing,” citing extensive internal records, testimony from staff and first-hand accounts from borrowers.

“It’s time for student borrowers to stop bearing the burden of ITT’s years of lies and false promises,” Education Secretary Miguel Cardona said in a statement. “The evidence shows that for years, ITT leaders deliberately misled students about the quality of their programs in order to benefit from the federal student loan program, without regard to the hardships it would cause.”

“The Biden-Harris administration will continue to stand up for borrowers who have been defrauded by colleges, while working to strengthen oversight and enforcement to protect current students from similar fraud and abuse,” he added.

Overall, the Biden administration has approved nearly $32 billion in student loan relief for more than 1.6 million borrowers. However, the relief that has been greenlighted is only for certain borrowers, including those participating in the Public Service Loan Forgiveness Program, borrowers with total and permanent disabilities and those found to have been misled by their institutions.

The Biden administration has been under pressure from progressives and student loan advocates for broader relief, especially as the current moratorium on federal student loan payments is scheduled to expire at the end of August.

The White House has indicated that another decision on student loans could come later this month, after all report emerged earlier this year that President Biden is considering a plan to provide $10,000 in student loan forgiveness for some borrowers.

But officials have kept mum when it comes to the public to share details about his plans.

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