Biden administration cancels another $4.5 billion in student debt
Over 261,000 borrowers who attended Ashford University between March 2009 and April 2020 will benefit from the decision.
Biden to leave White House on Jan. 20/ Andrew Caballero- Reynolds
Within days of leaving the White House, the Biden administration announced the elimination of student debt for 261,000 individuals, involving some $4.5 billion forgiven. The announcement adds to the series of last-minute measures implemented by Joe Biden before leaving office including the elimination of Cuba from the list of countries sponsoring terrorism, among other things.
The Department of Education (DOE) was in charge of delivering the news that favored hundreds of thousands of borrowers who attended Ashford University between March 2009 and April 2020. The debt forgiveness was the result of a lawsuit brought by the DOE against the aforementioned educational institution and its parent company, Zovio, Inc.
According to the lawsuit, the university made "widespread misrepresentations" about students' ability to obtain the necessary licensure, transfer credits, the cost and total financial aid and how long it would take individuals to earn a degree.
"Numerous federal and state investigations have documented the deceptive recruiting tactics frequently used by Ashford University. In reality, 90 percent of Ashford students never graduated, and the few who did were often left with large debts and low incomes. Today’s announcement will finally provide relief to many students who were harmed by Ashford’s illegal actions," Undersecretary of Education James Kvaa said.
As for the beneficiaries of the measure, they will be notified in the next few days and will not have to do anything, just wait to be notified. The DOE itself will contact them by email to announce that their outstanding balances will be canceled.
How much student debt did the Biden administration forgive?
According to the Department of Education, the Biden administration forgave debt for about 5.3 million people. The numbers break down as follows:
- $78.5 billion through improvements in public service loan forgiveness.
- $56.5 billion for more through the means-tested repayment plan, including the SAVE plan to save on valuable education.
- $18.7 billion for nearly 633,000 borrowers with a total and permanent disability.
- $34 billion for borrowers whose schools took advantage of them, closed or are covered by related court settlements.
As for the monetary total forgiven over the past four years, it is estimated at more than $186 billion.
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