Staking Out Sides on Student Debt Discharge

August 2, 2016
  • Industry News
  • student debt

The U.S. Department of Education has received more than10,000 comments in response to a proposed rule for federal loan forgiveness for students whose colleges have defrauded them. The deadline for submitting comments was 11:59 p.m. Aug. 1.

The department released the new proposed regulations, known as defense to repayment, in June in response to the collapse of Corinthian Colleges. While they are drawing praise from consumer protection groups, a range of groups, including taxpayer advocates and historically black and other colleges, have raised alarms over wider repercussions of the rules. Several mainstream higher education advocacy groups are also weighing in with concerns over unintended consequences of the rules.

Among the main requirements of the proposed rules: colleges and universities must provide warnings to students about poor loan repayment rates and set aside money for loan forgiveness. Most critically, they lay out a path for the government to forgive students' debt when they claim they were defrauded by their institution.

Read more at Inside Higher Ed: https://www.insidehighered.com/news/2016/08/02/us-receives-thousands-comments-proposed-student-debt-forgiveness-rules