Student loan debt has become a significant issue in the United States, affecting many individuals who struggle to repay their loans. There have been calls for the forgiveness of such debts to provide relief to borrowers and help them rebuild their lives without the burden of excessive financial obligations.
The Biden Administration recently announced a significant move towards debt forgiveness. It was revealed that the debts of more than 560,000 students who attended Corinthian Colleges, a chain of for-profit universities known for their exploitative financial practices, will be forgiven. This forgiveness will amount to around $5.8 billion in student loan debt, marking the largest loan forgiveness action taken by the US Department of Education.
Speaking about the decision, Education Secretary Miguel Cardona stated, “As of today, every student deceived, defrauded, and burdened with debt by Corinthian Colleges can be reassured that the Biden-Harris Administration has their back and will discharge their federal student loans. Corinthian Colleges engaged in deceptive financial practices, leading students to accumulate debt to fulfill promises that were never kept.”
Breaking News: The U.S. Education Dept. will cancel $5.8 billion in student loans owed by Corinthian Colleges students, representing its largest student loan forgiveness action ever. https://t.co/S5MKUs6KIB
— The New York Times (@nytimes) June 2, 2022
Many Corinthian students were previously eligible for debt forgiveness but faced challenges in navigating the complex application process set by the institution. The recent announcement ensures that the refund process will be automated, making it easier for affected students. Moreover, current and former Corinthian students with outstanding debt will receive refunds for any payments made towards their loans, in addition to having their balances cleared. However, students who have already fully repaid their loans will not be eligible for refunds from the Education Department.
