Student loans

Here’s everyone who qualifies after the White House announces an additional $1.5 billion pardon

Topline

On Tuesday, the White House canceled $1.5 billion in student loan debt for participants at the now-closed Westwood College, bringing total relief under the Biden administration to $34 billion even before the sweeping recovery plan. President Joe Biden’s loan cancellation unveiled last week does not go into effect. .

Highlights

The measure cancels all debts of Westwood’s 79,000 students who enrolled in the school online or at its Westminster, Colorado campus between 2002 and 2015, and took out federal loans, the Department of Education announcement Tuesday.

A for-profit school that closed in 2016, Westwood “has engaged in widespread misrepresentation of the value of its degrees” to its students, the Department of Education said.

The announcement follows similar relief programs earlier this year: the White House canceled $5.8 billion debt for Corinthian College students in June and $3.9 billion for attendees at the ITT Technical Institute earlier this month.

Following policy changes last year, the Biden administration also forgave over $10 billion in student loans for 175,000 public service workers and $9 billion for 425,000 borrowers with total and permanent disabilities.

The targeted relief efforts coincide with Biden’s highly anticipated announcement last Wednesday canceling up to $10,000 in student loan debt for all borrowers who earn less than $125,000 a year (or $250,000 in household income ) and up to $20,000 for borrowers who qualified for the Federal Pell Grants for Low-Income Individuals. income of first-time university students who also fall below the income threshold.

crucial quote

“Like Corinthian & ITT, Westwood College has exploited students and abused federal financial aid,” Education Secretary Miguel Cardona said. tweeted. “Borrowers shouldn’t be stuck with this bill.”

Key Context

The federal government had already forgiven the debt of more than 4,400 Westwood students after the school misled students about job prospects and credit transferability, and the Department of Education Noted the general discharge was an effective means of rationalizing a high volume of relief requests. Biden’s general relief plan could wipe out the remaining debt balances of the 53% of all borrowers who hold less than $20,000 in debt. It is unclear exactly what the total amount of student debt relief the expansive forgiveness will provide given the eligibility requirements will be, although estimates call for it to be over $300 billion, much of it of the $1.62 trillion in federal student loan debt held by Americans.

Further reading

Biden’s Student Loan Forgiveness Plan: Up to $20,000 in relief, $125,000 income cap — here’s all the other details (Forbes)

Biden’s Student Loan Forgiveness Plan: Here’s Who Benefits Most and Least (Forbes)

Important new details on Biden’s student loan forgiveness plan, including when to expect relief (Forbes)