NEW YORK TIMES: The Government Should Actively Notify Borrowers of Their Rights to Loan Forgiveness
Career College Central Summary:
All students who are unable to complete their education due to a college closure should qualify for federal loan forgiveness. Without a diploma or degree, most students do not benefit from their incomplete education. They cannot transfer credits and must start over to earn a credential.
In the case of Corinthian, 16,000 students who saw their campuses close are eligible to have their loans cancelled as long as they don't complete the same program after they transfer their credits to another school. The few who transfer credits are not usually eligible for loan forgiveness, although many still have difficulty finding the types of employment the closed school likely promised they would obtain after graduating.
Debt forgiveness re-opens educational opportunity for students harmed by sudden school closures. But, according to the U.S. Department of Education, only 6 percent of potentially eligible borrowers have requested loan forgiveness. Thousands of low-income borrowers whose debts should be forgiven instead struggle financially because of the government’s draconian powers to collect student loan debts.
Very few of these borrowers are aware of their loan forgiveness rights. For this reason, the department should notify the large number of borrowers harmed by past school closures of their potential eligibility.
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NEW YORK TIMES
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