Biden administration proposes canceling $6B in student debt for 200,000 people in settlement

  • In Politics
  • 2022-06-23 20:58:23Z

The Biden administration this week agreed to cancel approximately $6 billion in federal student debt for about 200,000 people who attended schools that they alleged defrauded them.

The Department of Education said it would wipe the debt for the borrowers in a proposed settlement filed in federal court on Wednesday. The settlement addresses a class-action lawsuit filed in 2019 that has accused the Trump administration and Biden administration of delaying solutions for borrowers who filed for relief.

The proposed settlement will need to be approved by a judge, and a hearing has been scheduled for next month.

In addition to canceling debt, the agreement would refund borrowers for money they previously paid to the Department of Education and offer credit repair options.

50 years after Title IX: Most top colleges deprive female athletes of equal opportunities

For subscribers: The Supreme Court just made a monumental ruling on gun rights. Here's what it means.

The deal would reverse 128,000 "denial notices" sent to people during the Trump administration who were applying for relief, according to multiple reports.

The agreement would help people who attended dozens of different schools, which are mostly for-profit colleges and other vocational programs. The schools include the University of Phoenix, DeVry University and more.

The department said in the proposed settlement it determined that attendance at the schools "justifies presumptive relief, for purposes of this settlement, based on strong indicia regarding substantial misconduct by listed schools, whether credibly alleged or in some instances proven, and the high rate of class members with applications related to the listed schools."

Education: Billions in student loans erased for students preyed upon by Corinthian Colleges; most relief yet by White House

'Extraordinary investment': Dartmouth College eliminating loans from its financial aid packages

Education Secretary Miguel Cardona in a statement on Wednesday said "We are pleased to have worked with plaintiffs to reach an agreement that will deliver billions of dollars of automatic relief to approximately 200,000 borrowers and that we believe will resolve plaintiffs' claims in a manner that is fair and equitable for all parties."

The move comes after officials announced earlier this month that people who borrowed money to attend a school owned by Corinthian Colleges will have federal student loans canceled. The discharge amounted to approximately $5.8 billion in relief for more than a half million borrowers.

Payments for federal student loans remain frozen during the ongoing coronavirus pandemic, though the freeze is currently set to lift at the end of August.

It also comes as President Joe Biden is considering wider student loan forgiveness. He supported forgiving up to $10,000 of student debt for each borrower during his presidential campaign, though he has also said widespread loan forgiveness would need to come from Congress.

Contributing: Chris Quintana, USA TODAY

This article originally appeared on USA TODAY: Student loans: Biden admin proposes canceling $6 billion in debt


More Related News

Student-loan borrowers shouldn
Student-loan borrowers shouldn't have to pay off debt Biden 'has promised to cancel,' 180 organizations say - and they're calling for another payment pause extension

The NAACP and major unions signed onto a letter exclusive to Insider urging Biden to "enact robust student debt cancellation" without any limits.

Supreme Court allows Biden to end Trump-era
Supreme Court allows Biden to end Trump-era 'Remain in Mexico' policy

The Supreme Court ruled Biden can shut down the Trump-era "Remain in Mexico" program, which was designed to restrict immigration at the southern border.

Analysis-Back to the drawing board: U.S. Supreme Court upends Biden climate agenda
Analysis-Back to the drawing board: U.S. Supreme Court upends Biden climate agenda

WASHINGTON (Reuters) -The U.S. Supreme Court dealt a blow to President Joe Biden's plans to tackle climate change on Thursday with a ruling that limits the...

Explainer-What is the Trump-era
Explainer-What is the Trump-era 'remain in Mexico' program the Supreme Court said Biden can end?

The U.S. Supreme Court on Thursday ruled that President Joe Biden can end a program put in place by his predecessor former President Donald Trump, which...

Supreme Court: Biden may end Trump-era
Supreme Court: Biden may end Trump-era 'remain in Mexico' policy for migrants

The Supreme Court case involved one of the last major immigration policies held over from the Trump era: A mandate that asylum seekers wait in Mexico.

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply


Top News: Politics