Dear Secretary Cardona: Cancel For-Profit College Debt Now | Blog
There has been a lot of talk recently about student debt cancellation and what President Biden and his administration can do about it.
There’s no doubt that tackling the student debt crisis is one of the most significant challenges of our time. But as we’ve explained before: the government has a legal obligation to cancel the debts of our clients, students defrauded by predatory for-profit colleges, and they cannot afford to wait any longer.
That’s why we wrote a letter to President Biden’s recently confirmed Education Secretary Miguel Cardona, outlining his authority and obligation to take three immediate actions to finally provide justice for students who were harmed by this industry:
Cancel all debts from Corinthian Colleges;
Cancel all debts from ITT Tech; and
Cancel all debts of former for-profit college students who have applied for borrower defense discharge.
Not only is the government legally obligated to discharge these loans, doing so will help the people that President Biden and Vice President Harris have spoken so passionately about being left behind by a broken higher education system.
The fact is, the vast majority of our clients and those preyed on by this industry are first-generation, low-income, veterans, single mothers, and students of color. Black and Latinx students make up less than one third of all college students, but represent nearly half of those attending for-profit institutions.
We have seen the devastation these debts have caused them. We have also seen the incredible way debt cancellation has liberated them in our cases. It has changed peoples’ lives for the better. Cancellation of these debts goes well beyond the debts themselves – it leads to decreases in other kinds of debt for households and increases earnings. It gives them a new lease on life.
You don’t have to take our word for it. In countless statements from our clients, which were also shared with Secretary Cardona, their shared trauma is palpable. That trauma has only been compounded as they’ve had their futures held hostage while waiting for the government to act and follow the law – many of them waiting years on decisions on their borrower defense applications, now spanning three presidential administrations.
As Jenette G., a former Corinthian student from California, explained:
"I have been fighting this for a very long time. They have taken every tax return I've been owed since 2014. I want to go to college so badly and get an education and career in nursing but this loan is making it impossible to do so. I've been working nonstop since I was 16 and have been laid off because of COVID. So, I wanted to use this time to start college and become a nurse. But I can't and it breaks my heart. I got scammed and I'm being punished for it.”
Students like Jenette who were cheated by their schools are legally entitled to the cancellation of their federal student loans. This has been the law since before 1995, when the first borrower defense regulation took effect. It is not up for debate; it is not a new policy proposal.Under Obama, Corinthian students were promised loan cancellation five years ago. Yet somehow, tens of thousands of students are still waiting.The law is clear: The Biden-Harris administration has the legal obligation to cancel the debts of the for-profit students who have pending borrower defense claims right now.Cancelling the debts from Corinthian Colleges, ITT Tech, and all borrower defense applicants, will be a monumental step toward long-overdue justice for these students who have been waiting far too long already.