Biden Administration Cancels $ 500 Million Student Loan Debt: Here’s Who Eligible

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FILE – US President Joe Biden talks about the March Jobs Report at the White House cafeteria in Washington, D.C. on April 2, 2021.

US Department of Education under the leadership of President Joe Biden, recently announced that 18,000 students who were defrauded by ITT will receive a student loan forgiveness. In total, over $ 500 million in student debt has been written off, representing an average of about $ 28,000 per borrower.

The move is part borrower protection programwhich offers forgiveness for repaying the loan to students who feel they have been misled by the higher education institution. So far, the Biden administration has canceled $ 1.5 billion in student loans for approximately 90,000 borrowers under the program.

Former ITT students said the for-profit institute, which closed in 2016, made false claims about job prospects as well as the ability to transfer loans. The Department of Education found that the institute misrepresented the potential for a degree from ITT; in fact, ITT alumni have stated that including them on resumes makes it harder to find a job.

“Many of these borrowers have been waiting for help for a long time, and we must act quickly to make decisions for those whose claims have not yet been resolved,” Education Minister Miguel Cardona said in a statement. “This work also highlights the need for ongoing accountability so that institutions can never again commit this kind of widespread deception.”

While the defrauded ITT alumni received their loans, millions of other Americans are still paying off student loans. Broader measures to forgive student loans are still not available, so don’t wait for your loans to be paid off if you’re struggling to pay off your college debt. Instead, take advantage of record low student loan refinancing rates to save money on private student loans

How to know if student loan refinancing is right for you

Refinancing a student loan may help some borrowers pay off their loans faster and save money with a lower interest rate, but this is not suitable for everyone.

Not recommended refinance federal student loansfor example, as it means you will lose federal protections such as income-based payments and zero percent COVID-19 waiver. It could even strip you of your eligibility if the federal government decides to cancel your student loan debt in the future.

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However, student loan borrowers who are in arrears on private student loans should consider refinancing while rates are at record lows. This can lower your student loan payments or help you pay off your private loans faster. Student loan cancellation does not apply to private loans, so there is no risk of losing benefits when refinancing them. You can compare student loan refinancing rates from several lenders at once using the Credible online marketplace.

Still not sure if refinancing is a good idea?

Refinancing a student loan can save borrowers thousands of dollars in the loan repayment process. It is important to weigh the pros and cons and remember that this does not apply to everyone’s personal financial situation.

Those who refinanced their shorter term private student loans with Credible saved an average of $ 17,344. See if refinancing your student loan is a smart move for you using student loan repayment calculator

And if you still have questions, contact an experienced student loan consolidator on Credible for more information.

Have a financial question but don’t know who to contact? Write to the Safe Money Specialist at moneyexpert@credible.com and your question can be answered by Credible in our Money Expert column.

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