The Trump administration said Thursday it will cancel thousands of borrowers’ federal student loans, carrying out an Obama-era policy that Education Secretary Betsy DeVos had fought to kill.
The move comes as DeVos is being forced to implement a package of regulations that created more protections for student loan borrowers who were affected by a school closure or defrauded by their college.
A federal judge in September ruled that DeVos’ efforts to stop the 2016 “borrower defense” regulations from taking effect was illegal. And in October, the same judge rejected a bid by for-profit colleges to immediately stop the regulations, clearing the way for them to take effect.
Education Department officials said Thursday that they will cancel the loans of about 15,000 borrowers who qualified for “closed school” loan discharges but who haven’t yet applied for that benefit. Those student loans total approximately $150 million.
Department officials said they would begin notifying borrowers Friday by email that they will receive the loan discharges. Borrowers will not have to take any action, but the process could take as long as 90 days to complete…..