The Biden Administration Canceled $ 1.5 Billion Student Loans Through Borrower Defense: How To Apply

The Biden government approved $ 1.5 billion worth of borrowers defense for repayment requests between January and July. You can qualify for a discharge from the borrower’s defense if your school has misled you or violated state laws. (iStock)

President Joe Biden campaigned for up to $ 10,000 in student loan debt per borrower to be canceled, but federal student loan forgiveness law has proven difficult. While widespread student loan cancellation may still be out of reach, the Department of Education was able to approve $ 1.5 billion in student loan relief by defending the borrower until repayment.

Borrower Defense is a program run by the Federal Student Aid Office (FSA) to cancel federal student loan debt for borrowers who have been misled by their college. This includes schools that have committed misconduct in violation of applicable state law.

The Biden government has approved borrower defense claims for approximately 92,000 students who have attended for-profit colleges such as the ITT Technical Institute, Westwood College, Marinello Schools of Beauty, and the Court Reporting Institute. Under the Obama administration in 2013, students filed similar lawsuits following the closure of Corinthian colleges.

Read on to learn more about borrower defense rules and what to do if you don’t qualify. Alternatives to borrower defense are signing up for an income-oriented repayment plan, researching other student loans Forgiveness and R.finance the debt of your student loan.

If you decide to refinance your student debt, visit Credible to compare quotes from multiple private student loan lenders at the same time without affecting your creditworthiness.

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How to Apply for Borrower Defense

You may qualify for the Borrower Defense Program for Repayment if you have attended a school that has historically misled students about the quality of their program or their earnings potential. For example, the Department of Education took the loans off of 18,000 ITT Tech students who claimed the school misled them about their job prospects and job placement Tariffs and the ability to transfer credits.

To apply for a borrower defense, you will need to fill out an application form. You will need to provide transcripts and other information about your school and the collection status of your loans. You will also need to demonstrate a basis for defending the borrower by including:

  • School promotional materials including brochures, enrollment agreements, websites and emails
  • Name and title of school officials who misled you, if known
  • What information did the school provide or not?
  • Why do you think you are misled?

It takes about 30 minutes to complete the application process. More frequently asked questions can be found on the FSA website.

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What to do if you are not entitled to a student loan waiver

Only a fraction of the 45 million US student loan borrowers have qualified for student loan waivers under the Biden administration. While it is possible to ask the Department of Education to reconsider your application to defend the borrower by mail, there are other options if you do not qualify for a loan exemption:

Use the table below to browse the student loan interest rates from real lenders. To see student loan refinancing offers tailored to your needs, be prequalified in a few minutes on Credible.

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Is Student Loan Refinancing Right For You?

Refinancing private student loans can be an effective way to find student loan relief, avoid defaults, and save money over time.

According to data from Credible, creditworthy borrowers who refinanced to a shorter-term student loan with Credible have saved nearly $ 17,000 and paid off their college debt 41 months faster. Borrowers who refinanced into a longer-term loan reduced their payments by more than $ 250 without increasing the total cost of the loan.

You can use Credible’s refinance calculator to see how much you can save by refinancing at a lower interest rate.

However, refinancing student loans is not necessarily suitable for everyone. Borrowers with federal student loans may lose state protections like income-oriented repayment plans and administrative leniency by refinancing into a private loan.

Still not sure whether to refinance your college debt? Contact an experienced loan officer at Credible to learn more about student loan refinancing.

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