Biden’s education department has just set a priority for student loan bailouts


Joe Biden

President Joe Biden. AP Photo / Alex Brandon

  • Biden’s regulatory agenda, announced on Friday, includes a student loan forgiveness proposal.

  • The Ministry of Education plans to improve the loan forgiveness program by 2022, but details are unknown.

  • Democrats and borrowers continue to seek immediate debt relief while Mr Biden is reluctant.

  • See other stories on Insider’s business page..

From fighting the climate crisis to strengthening protection against racism, President Joe Biden’s regulatory agenda, announced Friday, covers many grounds. Importantly, unlike him budget, It also mentions student loan forgiveness. But for borrowers waiting for the debt to become clear, the details are scarce.

Is list The Regulatory Measures Summary, usually published twice a year, outlines how Biden plans to advance his agenda through federal agencies.

According to the Ministry of Education page, Biden’s agenda is “Improved student loan cancellation authoritySecretary of Education Miguel Cardona told borrowers who meet loan cancellation criteria such as complete and permanent disability and attending a recently closed school, “Rules for improving borrower eligibility, application requirements and processes. To revise. “

The ministry also Review The Public Service Loan Forgiveness (PSLF) program and “Plans to consider these regulations for improvement”, and Fix “Borrower’s defense against repayment” exempts students from debt fooled by commercial schools.

The ministry plans to complete the rules by April 2022.

“We’ve learned a clear lesson in the last four years about what happens if the government fails to fulfill its responsibility to protect Americans,” said Sharon Brock, Deputy Secretary-General of the White House Regulatory Authority, in a statement. “Our first regulatory agenda demonstrates our commitment to reverse this trend.”

At the end of May, the Education Department Announced It has begun the process of issuing new higher education rules, and Friday’s list confirmed those plans. However, no further details were provided as to what the improvements mentioned would look like.

This may be because the department is in the early stages of rule creation. The first step in the process was to hold a hearing in June to receive feedback on the student loan exemption program, and after the June hearing, stakeholders were proposed to meet with the department. “Rule creation by negotiation” is performed to examine the rules. It may take a year or more for the changes to take effect.

However, borrowers and lawmakers are complaining about the timeline for granting student loan forgiveness to qualified borrowers.

Biden Was campaigned For PSLF reforms, government and non-profit employees using federally-sponsored student loans apply for loan exemption after proving 120 monthly payments based on a qualified repayment plan. I am trying to do it.

However, the flaws in the program have been going on for years. 98% of borrowers are rejected by the program 56 Democratic supporters Secretary of Education Betsy DeVos was sued after urging Cardona to revise the program in early May More than once The program’s high rejection rate has been exceeded.

The borrower had similar problems with the defense of the borrower’s repayment. For the past 10 years Some commercial schools President Barack Obama has established a program to waive student loans for qualified fraudulent borrowers after closing an investigation claiming that the school is involved in fraud related to federal loans.

Under the Obama administration, the program was approved at 99.2%, but when DeVos took over, 99.4% of eligible borrowers were rejected by the program. Testify immediately About why it happened.

Therefore, the ministry’s plans to review these programs are promising for borrowers, but the specific details are unknown. As a result, Massachusetts Senator Elizabeth Warren and other Democrats are calling on Biden to cancel a $ 50,000 student loan per borrower and provide immediate relief.

“Now is the time,” Warren told Insider on Tuesday. “We know what the problem is. Student loan debt is stalling tens of millions of people across the country. People who can’t buy a house, people who can’t buy a car, small businesses Those who can’t get started. We need to cancel that student loan debt not only for those people, but for our entire economy. “

The education department did not immediately respond to Insider’s request for comment.

Read the original article Business insider

Posted on