Since Trump took office, student loan forgiveness in cases of possible fraud has come to a screeching halt, according to Department of Education records released to Sen. Dick Durbin on Wednesday. The records show that nearly 15,000 people applied for loan forgiveness from January 20 to July 5, claiming their colleges and universities defrauded them. None of those applications have been approved.
This inaction isn’t the only time Trump’s Department of Education has halted student loan forgiveness. In June, the department also announced its decision to delay and rewrite the borrower defense to repayment rule, an Obama-era rule that would have made it easier for students to have their loans forgiven if they were deceived by their schools. That rule was set to go into effect July 1, but it was indefinitely postponed.
Sen. Durbin condemned the Department of Education for both actions (or rather, inactions). “This response shows that while the Department of Education has illegally delayed the new borrower defense rule, it has also stopped processing federal student loan relief under current regulations for tens of thousands of defrauded borrowers,” he said in a statement in the Chicago Tribune. “The department can’t ignore these borrowers any longer.”
In 2016, the Government Accountability Office estimated the U.S. would forgive $108 million in student debt in the next 10 to 20 years. On the campaign trail, President Trump actually advocated for expanding student loan forgiveness by reducing the amount of time until relief from 20 years to 15 years. But since he took office, actions like dismantling the borrower defense rule have contradicted his campaign platform.
In the records released to Durbin, most of the applicants claimed fraud from for-profit colleges and universities, such as Corinthian Colleges and the shuttered ITT Technical Institute. Including those who applied since Trump took office, the department currently has over 65,000 applications pending for loan relief. The Obama administration approved over 28,000 applications for debt forgiveness from Corinthian Colleges students.
Most borrowers receive a grace period to delay beginning their loan payments while they wait, but that period is set to expire for 31,000 borrowers in the next six months. Students waiting for their applications to be processed are still accruing interest on their loans. According to the released documents, that interest totals $143 million.
