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The Education Department announced $6.1 billion in student-debt relief or 317,000 borrowers. The relief applies to borrowers who attended any Art Institute campus from January 1, 2004, to October 16, 2017. Investigations found that the Art Institutes misled students about career prospects and salaries. The Art Institutes were a for-profit system that prompted investigations from the attorneys general of Iowa, Massachusetts, and Pennsylvania. More broadly, the Education Department is working to implement its broader student-loan forgiveness plan after the Supreme Court struck down its first attempt.
Persons: , Joe Biden's, Richard Cordray, Biden Organizations: Education Department, Art Institute, Investigations, Art, Service, Joe Biden's Education Department, Art Institutes, Aid, Corinthian College, Public Locations: Iowa , Massachusetts, Pennsylvania
Read previewSome key changes are on the way for thousands of federal student-loan borrowers in public service. President Joe Biden's Education Department recently posted new guidance on Federal Student Aid's website with updates to the Public Service Loan Forgiveness program. Once PSLF processing resumes in July, borrowers' loans will remain with their servicer, but the Education Department will fully manage the program. As a result, borrowers can view their PSLF payments directly on studentaid.gov, access "enhanced" services like status tracking for their applications, and see quicker processing times for PSLF. AdvertisementOn top of this transition, MOHELA is in the process of transitioning borrowers to a new servicing platform, which could mean up to 30-day delays in posting payments.
Persons: , Joe Biden's, MOHELA, that'll, PSLF, Grant, Massachusetts Sen, Elizabeth Warren, Warren, Chuck Schumer, Sen, Bernie Sanders Organizations: Service, Joe Biden's Education Department, Federal, Public, Business, Teacher, College And Higher, Federal Student Aid, Education Department, PSLF, Protection Locations: Massachusetts
Some student-loan borrowers have one month left to benefit from one-time account adjustments. Borrowers who do not have qualifying loans need to consolidate by April 30. AdvertisementSome student-loan borrowers have just one month to get closer to debt relief. President Joe Biden's Education Department is nearing the end of its one-time account adjustment for borrowers on income-driven repayment plans and Public Service Loan Forgiveness. First implemented last summer, the adjustment allowed the department to evaluate borrowers' accounts every other month to determine which borrowers qualified for debt relief but had yet to receive it.
Persons: , Joe Biden's Organizations: Education Department, Service, Joe Biden's Education Department, Public, Business
Antonio Scordo, 50, is struggling to navigate the college financial aid process for his two daughters. Having already sent his son through college, Scordo was familiar with the Free Application for Federal Student Aid, or FAFSA, process — but this year has brought a host of new challenges. "We also don't want to apply for not enough because then you're scrambling to try to find money at the last minute. According to Federal Student Aid, the ability to make corrections and updates will not become available until "the first half of April." To help pay for his son and one of his daughter's schools, he took out nearly $50,000 in parent PLUS loans, per documents reviewed by BI.
Persons: Antonio Scordo, , Scordo, Joe Biden's, she's, she'll, Miguel Cardona, Cardona, they're Organizations: Service, Federal Student Aid, Joe Biden's Education Department, Business, BI, The Education Department, Politico, Microsoft, Education Department Locations: Scordo
Millions of student-loan borrowers might soon see improvements to the platforms they use to pay off their debt. Federal Student Aid also posted an announcement on its website with further details on the platform changes. This is likely an effort to prevent scams by making it clear to borrowers that the servicer works with the federal government. It'll ensure that borrowers can detect whether information is coming from an Education Department website to protect them from scams and reduce disruptions across servicing platforms. Advertisement"You will see more improvements when managing and repaying your loans in the coming year," the email to borrowers said.
Persons: Joe Biden's, MOHELA Organizations: Service, Joe Biden's Education Department, Business, Federal, Aid, Education Department
President Joe Biden's Education Department is officially one step closer to finalizing its second attempt at student-loan forgiveness for federal borrowers. This second attempt at student-debt relief is separated from the other targeted relief initiatives the Education Department has been in the process of carrying out. During a February 21 speech touting the latest relief, Biden said he would continue to pursue loan forgiveness for federal borrowers despite legal challenges. "Look, early in my term, I announced a major plan to provide millions of working families with debt relief for their college student debt. "I announced we were going to pursue alternative paths for student debt relief for as many borrowers as possible.
Persons: , Joe Biden's, It's, Biden's, Tamy Abernathy, Abernathy, Biden Organizations: Service, Joe Biden's Education Department, Higher, Education Department, Democratic, Federal Register, Republican
The Education Department released a proposal for including borrowers with hardship in debt relief. AdvertisementPresident Joe Biden's Education Department unveiled another group of student-loan borrowers it's considering for its second try at debt relief. On Thursday, the Education Department released its proposed text that focused on debt cancellation for borrowers facing financial hardship. Advertisement"College is meant to lead to a better life, but too many students end up struggling due to their student debt," Under Secretary of Education James Kvaal said in a statement. The Education Department emphasized in its press release that it "may consider these and other factors to determine whether borrowers are experiencing the type of hardship that would qualify for debt relief."
Persons: , Joe Biden's, Biden's, Education James Kvaal, Kvaal, Harris, Pell Grant Organizations: Education Department, Service, Joe Biden's Education Department, Higher, Democratic, Education, Biden, Federal
Time is running out for some student-loan borrowers to benefit from a limited-time debt cancellation reform. AdvertisementBorrowers who will receive the account adjustment automatically must be in the federal direct loan program or the Federal Family Education Loan program with loans held by the Education Department. Other borrowers who have loans in the FFEL program that are commercially held would need to consolidate into the direct loan program to receive relief. AdvertisementAt the same time, the Education Department is in the process of crafting its second attempt at more expansive relief for borrowers. On February 22 and 23, it will meet with stakeholders for the fourth time to negotiate the text of debt relief under the Higher Education Act of 1965.
Persons: Joe Biden's, Biden, Biden's Organizations: Service, Joe Biden's Education Department, Public, Business, Aid, Family Education, Education Department, Higher
The pressure keeps building on President Joe Biden's Education Department to include as many student-loan borrowers as possible in its second debt relief plan. After the Supreme Court struck down Biden's first attempt at broad debt cancellation, the Education Department announced it would be pursuing a new route for relief using the Higher Education Act of 1965. However, it did not include a category for borrowers with financial hardship, and some of the negotiators are requesting an additional session to discuss that topic. "As we repeatedly stated in the negotiations, we think that regulations that allow the Secretary to provide debt relief based on borrowers' financial hardship are a critical part of any debt cancellation agenda," they wrote. The Education Department has not yet commented on whether it will add an additional session.
Persons: Joe Biden's, Miguel Cardona, Biden's Organizations: Service, Joe Biden's Education Department, Business, Education Department, Higher, The Education Department, Democratic, Department, Federal
Read previewThere's still time for President Joe Biden's Education Department to consider more student-loan borrowers for its second debt relief plan, a group of Democrats said. On Thursday, 38 Democratic lawmakers — including Sens. The key issue concerns the groups of borrowers the Education Department proposed to include in its relief. The Education Department has not yet indicated whether it will add a fourth session. Advertisement"The Department's priority is to support students and borrowers, and is moving as quickly as possible to provide student debt relief to as many borrowers as possible, including through the regulatory process," the spokesperson said.
Persons: , Joe Biden's, Elizabeth Warren, Chuck Schumer, Bernie Sanders —, Secretary Miguel Cardona, Biden's, didn't, Biden Organizations: Service, Joe Biden's Education Department, Business, Democratic, , Secretary, Education Department, Higher, Department, Biden Administration Locations: Sens
Read previewPresident Joe Biden's Education Department has kicked off another round of negotiations to craft new rules for higher education — and it could get some student-loan borrowers extra cash. One of the department's proposals concerns how schools manage students' meal plans. AdvertisementThe department will continue negotiations on these regulations in February and March sessions with stakeholders, with the opportunity for public comment. Along with the cash management proposals, the department is also in the regulatory process of crafting its second attempt at student-debt relief for borrowers. "Failing to finalize a proposal to provide relief for borrowers experiencing hardship would result in millions of borrowers — including most recent graduates, many low-income borrowers, borrowers of color, and borrowers with disabilities — being left out of the necessary debt relief," nearly 70 advocacy groups sent to Education Secretary Miguel Cardona last week.
Persons: , Joe Biden's, They're, Biden's, Education Secretary Miguel Cardona Organizations: Service, Joe Biden's Education, Business, Education Department, Higher, Education Secretary
Read previewIt hasn't been easy for student-loan borrowers since payments restarted a few months ago — and for the companies that manage their debt. The Education Department is aware of those errors and highlighted them in an internal Federal Student Aid memo in November. AdvertisementIn the past fiscal year, Congress did not boost funding for Federal Student Aid, which oversees all student-loan operations. And in the current round of budget negotiations, House Republicans have proposed steep cuts for Federal Student Aid. One servicer, MOHELA, told Democratic lawmakers in response to queries on repayment preparation that "millions of borrowers resumed repayment simultaneously after a multi-year pause."
Persons: , Joe Biden's, MOHELA, servicers, Miguel Cardona, that's, servicer, I'm, Harris, Cardona Organizations: Service, Business, Joe Biden's Education Department, Education Department, Department, Education, Federal, Aid, The Education, Federal Student Aid, House Republicans, Democratic, Biden, Harris Administration
This benefit will be put into effect ahead of schedule — all provisions of the SAVE plan were set to be implemented by July 1, 2024. Which borrowers qualify for early relief? Borrowers must first be enrolled in the SAVE plan to qualify for this early relief, which they can do at studentaid.gov. Borrowers who automatically qualify for the shortened timeline for relief will begin seeing their balances wiped out in February. The department said it will continue to identify borrowers who qualify for relief on "a regular basis," per the press release.
Persons: , Joe Biden's, Education James Kvaal Organizations: Service, Business, Joe Biden's Education Department, Education, SAVE, Education Department
Chris Fleshren, 63, is struggling to afford student-loan payments on top of hefty medical bills. AdvertisementChris Fleshren is just a few years away from retirement, and he's sick of dealing with the "bureaucratic" student-loan industry. Chris FleshrenMillions of borrowers are now dealing with a monthly bill they haven't paid in over three years due to the pandemic pause on student-loan payments. However, that relief isn't enough for some borrowers as they struggle to afford basic necessities and other forms of debt. "I understand they want me to pay them and I'm willing to pay them," Fleshren said.
Persons: Chris Fleshren, he's, Biden's, , Fleshren, Joe Biden's, I'm, There's, Pell Grant, It's, they're Organizations: Service, Information Systems, Joe Biden's Education Department, Security, Education Department, Higher Locations: Nelnet
It's a result of an account adjustment for borrowers who made the required 20 or 25 years of payments. AdvertisementGeorge Tucker thought he would be resuming student-loan payments alongside millions of other borrowers this fall. Tucker, 63, owed just under $50,000 on his student loans when the more than three-year pause on federal payments ended in October, per documents reviewed by Insider. Although PSLF was intended to forgive student debt after ten years of qualifying payments, Tucker said paperwork challenges with the program threw him off track, and he was not anticipating debt relief. George Tucker got $50,000 in student debt wiped out.
Persons: George Tucker, It's, Tucker, , Little, he's, PSLF, MOHELA, Harris, Joe Biden's, isn't, Miguel Cardona, servicers, Jason Harmon, Harmon couldn't Organizations: Service, Public, Harris Administration, Biden, Joe Biden's Education Department, Department, Education, Education Department, MOHELA
Amy, 59, is not required to make any student loan payments while pursuing her teaching certificate. It comes as the Education Department is working to strengthen oversight over servicers. AdvertisementAdvertisementWhile federal student-loan payments resumed for most borrowers in October, Amy, 59, knew she was not expected to make any payments. "But that's not the case with student loans. "It's ridiculous these companies get contracts for federal student loans," Amy said.
Persons: Amy, servicer, , MOHELA, Joe Biden's, servicers, Amy —, she's, that's, it's, Harris, Education Miguel Cardona Organizations: Education Department, Service, Joe Biden's Education Department, The Education Department, Aid, Biden, Harris Administration, Education
The Education Department released new guidance on holding student-loan servicers accountable. download the app Email address Sign up By clicking “Sign Up”, you accept our Terms of Service and Privacy Policy . AdvertisementAdvertisementPresident Joe Biden's Education Department just warned student-loan companies that they can't keep getting away with bad behavior. On Thursday, the Education Department announced a new framework for holding services accountable as the transition back into repayment for millions of borrowers continues. The framework outlines how the department will monitor the quality of customer service borrowers are receiving from their servicers, along with punishments when servicers do not fulfill their contractual obligations.
Persons: servicers, , Joe Biden's, Harris, Education Miguel Cardona Organizations: Education Department, Service, Joe Biden's Education, Biden, Harris Administration, Education, MOHELA Locations: servicers
The Education Department is getting relief to some student-loan borrowers through a one-time account adjustment. Over the summer, President Joe Biden's Education Department announced a one-time account adjustment for borrowers on income-driven repayment plans and Public Service Loan Forgiveness. Following past issues tracking payments for borrowers in targeted relief programs, the adjustment allows borrowers another shot to have their accounts evaluated, and updated correctly, to bring them closer to debt relief. One group eligible for those relief programs is borrowers who hold Federal Family Education Loans. The Education Department instructed servicers to place all impacted borrowers on administrative forbearance without interest accrual until the issues are resolved.
Persons: , Joe Biden's, servicers Organizations: Department, Service, Joe Biden's Education Department, Public, Education Department, Higher
The Education Department is beginning its second round of negotiations for student-debt relief this week. AdvertisementAdvertisementPresident Joe Biden's Education Department is trying to ensure its second plan for student-debt relief can stand up against legal challenges. "This administration is taking another critical step to advance the President's goal of delivering debt relief to as many borrowers as possible. AdvertisementAdvertisement"Following the lead of Republican plaintiffs who filed suit in court, six Supreme Court justices wrongly blocked the President's first attempt of student debt relief," he said. AdvertisementAdvertisementIn September 2022, about a month after Biden announced his first broad relief plan, the Education Department updated its guidance to state that FFEL borrowers would no longer qualify for the relief.
Persons: , Joe Biden's, Economic Mobility Robert Gordon, Biden Organizations: Department, Service, Joe Biden's Education Department, Education Department, Higher, Republican, Economic Mobility, Family Education, guaranty, Politico
And Jess expected to pay around $137 a month in October, but she was billed a $49,000 monthly payment. AdvertisementAdvertisementIncorrect monthly billsWhen servicers attempted to convert borrowers to the new SAVE income-driven repayment plan, 78,000 borrowers got inaccurate bills. Additionally, 21,000 borrowers received monthly statements with "very high and potentially incorrect amounts due," per the memo. Hundreds of borrowers received bills stating they owed over $10,000 a month, with a few borrowers having monthly bills of over $100,000. According to the memo, borrowers are spending an average of 58 minutes on hold with their servicer, call lengths are about 70% longer than 2019 because borrowers have more questions.
Persons: , Alicia, Xiong Chang, Jess, Joe Biden's, servicers, It's, MOHELA, forbearance Servicers Organizations: Federal, Aid, Service, Joe Biden's Education Department, Public, Department, Education Department, Federal Student Aid Locations: forbearance
The Education Department is strengthening oversight by withholding pay from one servicer, MOHELA. AdvertisementAdvertisementPresident Joe Biden's Education Department made one thing very clear this past week: Student-loan companies cannot get away with bad behavior. It's unclear at this point how withholding pay from a servicer would impact its operations, and whether the impact would trickle down to borrowers. AdvertisementAdvertisementWith Republicans holding a majority in the House, it's unlikely Federal Student Aid will see boosted funding in the upcoming year. Buchanan noted that he's still determining how exactly withholding pay would impact operations and added that he's "not making any excuses for the mistakes here."
Persons: , Joe Biden's, MOHELA, Scott Buchanan, Jared Bass, Bass, servicers, Buchanan, he's, It's, it'll Organizations: Education Department, Service, Joe Biden's Education Department, Department, Federal Student Aid, Student Loan, , Education, Center, American Progress, Federal, Aid
The Education Department withheld pay from MOHELA over failure to deliver on-time billing statements. AdvertisementAdvertisementPresident Joe Biden's Education Department revealed that a major student-loan company made errors with millions of borrowers' accounts. The Education Department instructed MOHELA to place all affected borrowers on forbearances until the issues are resolved. Borrowers enrolled in Public Service Loan Forgiveness or an income-driven repayment plan will have any month spent in forbearance counted toward their forgiveness progress. The Education Department said that it will continue to monitor servicers' performance "and ensure they are meeting their basic contractual obligations to the Department and to borrowers.
Persons: , Joe Biden's, Miguel Cardona, MOHELA, Will, I'm, What's, servicers Organizations: Department, Service, Joe Biden's Education Department, MOHELA, Education Department, The Education Department, Federal Student, Federal Student Aid Locations: forbearance
The Education Department released a memo detailing mistakes it found student-loan servicers are making with repayment. It pushed for the mistakes to be remedied for borrowers to avoid legal action. AdvertisementAdvertisementPresident Joe Biden's Education Department is concerned student-loan borrowers could turn to legal action if issues with their accounts aren't fully resolved. The Education Department said it will continue enforcing oversight over servicers to ensure borrowers are not further harmed by mistakes to no fault of their own. "We are committed to making things right for borrowers and holding our contractors accountable for errors when they do occur."
Persons: MOHELA, , Joe Biden's, Education James Kvaal, servicers, I've, it's, Richard Cordray Organizations: Education Department, Service, Joe Biden's Education Department, Wednesday, Federal Student Aid, Education, MOHELA, Department, The Education Department Locations: forbearance
The Education Department released its draft text for its new student-debt relief plan. AdvertisementAdvertisementOver the past few years, Insider has heard from a range of borrowers who have struggled to get ahead of their student debt. Now, President Joe Biden's Education Department is moving forward with its new plan for student-loan forgiveness — and it wants feedback on which situations would meet a "hardship' standard for relief. The department said it did not include that group of borrowers in its initial draft text for debt relief because it needs to further define what hardship means. Do you think your student debt experiences should qualify as hardship?
Persons: , Joe Biden's, Pell, Tamy Abernathy Organizations: Education Department, Service, Joe Biden's Education Department, Higher
The Education Department fined for-profit Grand Canyon University $37 million over accusations of misleading behavior. It said Grand Canyon mispresented the costs of its doctoral programs, leading to high student debt. AdvertisementAdvertisementA major for-profit school just got hit with a fine over accusations of misleading thousands of its students. A senior department official told reporters on a Tuesday press call that this is the largest penalty the Education Department has ever enforced on a school. "Rather than the Department protecting students, we are being forced to protect our students from this targeted and unwarranted government overreach."
Persons: , Joe Biden's, GCU, Richard Cordray, GCU's, Aaron Ament, they'll Organizations: Education Department, Canyon University, Service, Joe Biden's Education Department, Grand Canyon University, Federal, Aid, Department, Federal Student Aid, The Education Department, University of Phoenix, Student Defense, of Education
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