For-profit loan for­give­ness pro­gram could see ma­jor cut

Hawaii Tribune Herald - - NEWS -

WASHINGTON — The Ed­u­ca­tion De­part­ment’s plan to pro­vide only par­tial loan for­give­ness to some stu­dents de­frauded by for-profit col­leges could re­duce over­all pay­ments by about 60 per­cent, ac­cord­ing to a pre­lim­i­nary anal­y­sis ob­tained by the As­so­ci­ated Press.

The agency an­nounced in De­cem­ber it was dis­con­tin­u­ing the Obama ad­min­is­tra­tion’s prac­tice of fully wip­ing out the loans of stu­dents de­ceived by the now-de­funct Corinthian Col­leges un­der the bor­rower de­fense rule.

The de­part­ment said some stu­dents now will get only par­tial loan for­give­ness to make the process fair and pro­tect tax­pay­ers from ex­ces­sive costs. The agency will look at av­er­age in­come for spe­cific pro­grams to de­ter­mine if the loans should be for­given fully or par­tially. A de­part­ment doc­u­ment drafted in the fall and viewed by the AP shows that such an ap­proach could cut the over­all amount of re­lief granted to stu­dents by about 60 per­cent. To ar­rive at the ini­tial es­ti­mate, of­fi­cials looked at stu­dent loans that were for­given in their en­tirety to de­ter­mine the im­pact had par­tial re­lief been granted.

Ed­u­ca­tion De­part­ment press sec­re­tary Liz Hill said in a state­ment Tues­day, “This is not an of­fi­cial cal­cu­la­tion from the De­part­ment of Ed­u­ca­tion. It is an im­pos­si­ble cal­cu­la­tion to make at this stage in the process as we con­tinue to ad­ju­di­cate claims.”

The ac­tion comes as Ed­u­ca­tion Sec­re­tary Betsy DeVos rewrites reg­u­la­tions gov­ern­ing stu­dent pro­tec­tions with re­gard to for-profit schools.

DEVOS

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