Students who secured loans to attend dubious, for-profit colleges may be able to get their loans forgiven. The new regulations set forth by the Education Department would provide a process for borrowers who believe they were misled about job prospects or otherwise deceived into enrolling colleges to cancel their debt.
More Transparency For Colleges
The rules, expected to take effect in July of 2017, go further to require schools to be more accountable to students and require institutions to set aside funds to cover claims brought by affected students moving forward.
Students Rack Up Debt With Nothing to Show For It
The proposal follows the downfall of a national, for-profit college company that allegedly fabricated employers to give the impression that their students had a promising career track following graduation. In fact, many of the students emerged with what some have called “a worthless piece of paper” rather than a degree that would land them gainful employment.
A Streamline Process for Debt Relief
In contrast to the uphill battle many students face seeking debt relief after being hoodwinked by abusive, for-profit colleges, the new rules would stream line the process for victims of school misconduct and bar colleges from forbidding students to bring class action law suits as part of the enrollment process.
Source: PBS Newshour.org, “New rule aims to streamline debt forgiveness for victims of rogue for-profit schools”, by Jennifer C. Kerr, June 13, 2016.