Education Department Completely Cancels Loans of 18,000 Former ITT Tech Students

June 16 (UPI) – The Education Department said on Wednesday it would completely cancel student loans for 18,000 former ITT Technical Institute students who were swindled by the for-profit college.

Education Secretary Miguel Cardona announced that the ministry provide $ 500 million in ITT student debt relief in its first action on the grounds that the defunct institution misled students about their ability to transfer credits to other schools and their career prospects after graduation.

“Our action today will give thousands of borrowers a fresh start and the relief they deserve after ITT has repeatedly lied to them,” Cardona said. “Many of these borrowers have waited a long time for relief and we must work quickly to make decisions for those whose claims are still outstanding.”

Since ITT Tech’s closure in 2016, 34,000 former students have asked the Department of Education to write off their debt under the Borrower’s Defense Against Repayment Act, after federal and state officials discovered that the school had misled students about the possibility of transferring their credits and their employment prospects.

Under former President Barack Obama, the agency created a plan to grant relief to ITT Tech students in California on the basis that it violated state law, but the former Secretary of Education Betsy DeVos has refused to approve or deny requests for debt relief under the administration of former President Donald Trump. .

In March, the Biden administration rolled back a Trump-era policy that offered students defrauded by for-profit institutions only partial relief, instead implementing a “simplified approach” which it says will eliminate approximately $ 1 billion in student loan debt of approximately 72,000 students. .

Cardona said eligible borrowers will be notified in the coming weeks and that the loan cancellations are part of a commitment by the Biden administration to “stand up for borrowers when their institutions benefit.”

“Many of these borrowers have been waiting for relief for a long time and we must work quickly to render decisions for those whose claims are still pending,” he said. “This work also emphasizes the need for continued accountability so that institutions can never again commit this kind of pervasive deception.”

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