BY Lake SydneyApril 28, 2022, 5:54 p.m.
US President Joe Biden speaks about supporting Ukrainians defending their country against Russia, in the Roosevelt Room of the White House in Washington, DC, as seen in April 2022. (Photo by Jim Watson – AFP/Getty Pictures)
President Joe Biden has yet to follow through on his plans to forgive up to $10,000 in student loan debt per borrower, but Thursday marked two more developments in his ongoing forgiveness strategy.
First, the Department of Education announced that 28,000 borrowers who attended Marinello Beauty Schools will receive a collective $238 million student loan forgiveness. Then, Biden also signaled something much bigger: A decision on whether to write off student loan debt en masse will come in the “coming weeks,” he told a news conference. .
“I’m looking at facing debt reduction,” Biden said. “I’m not considering a $50,000 debt reduction [per borrower], but I am carefully considering whether or not there will be additional forgiveness. I will have an answer on this subject in the next few weeks.
A reporter covering the conference asked “how far” Biden would go in terms of debt forgiveness per borrower, but the president did not offer an answer. Other top Democrats, including Senate Majority Leader Chuck Schumer and Sen. Elizabeth Warren, have pressed Biden to forgive $50,000 in debt per borrower.
Since taking office, Biden has canceled borrower loans in four distinct groups: defrauded borrowers, government employees, borrowers with total and permanent disabilities, and some borrowers with an income-based repayment plan. The total pardon under the Biden administration currently stands at over $20 billion. This latest round of forgiveness falls into the category of defrauded borrowers, which includes debt forgiveness for students who attended programs that defrauded or abused them.
“Marinello preyed on students who dreamed of careers in the beauty industry, misled them about the quality of their programs, and left them buried in unaffordable debt they couldn’t repay,” said said US Secretary of Education Miguel Cardona in a statement. “Today’s announcement will simplify access to debt relief for thousands of borrowers caught up in Marinello’s lies.”
Who qualifies for this round of forgiveness
In March 2021, Cardona and the Biden administration began offering forgiveness to borrowers with “reimbursement defense” claims, meaning the government determined the borrower was attending a school that had participated in deceptive practices. or illegal.
Students at Marinello Beauty Schools began receiving pardons for these Borrower Defense Applications in July 2021 when the Department of Education announced it would approve Borrower Defense Applications for 1,800 borrowers who attended the beauty school as well as the Court Reporting Institute and Westwood College.
According to the Department of Education’s announcement Thursday, about 300 Marinello borrower defense requests had been approved under July findings that the school had made “widespread and material misrepresentations about the education that would be offered on its campuses across the country”. This latest round of pardons will help an additional 24,000 borrowers who attended Marinello.
The round of forgiveness announced Thursday will go to borrowers who enrolled in schools from 2009 until Marinello closed in February 2016. At the time, the school operated 56 campuses, which “closed abruptly” after the Department of Education discovered that the school had been improperly dispatched. federal student aid funding.
The Department had also found that Marinello schools had failed to train students in key elements of cosmetology – including how to cut hair – and that schools had left students for weeks or months. without instructors, according to the Department’s statement.
“As a result, students would have found it extremely difficult to pass the necessary state licensing tests and receive the promised return on their educational investment,” according to the Department of Education. “Not only did Marinello fail to teach its students, but class action lawsuits in Nevada and California have alleged the school used salons as profit centers and exploited students as a source of unpaid labor.”
In total, debt forgiveness on borrower defense claims made under the Biden administration amounts to $2.1 billion among 132,000 borrowers, according to the Department of Education. This has included forgiveness for borrowers who attended other schools, including ITT Tech, Corinthian Colleges, DeVry University, Westwood College, and Minnesota School of Business/Globe University.
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