The Biden administration announced Wednesday that federal student loans will be canceled for hundreds of thousands of students who attended Corinthian Colleges. This is a step to close one of the most infamous cases of fraud in American higher-education.
The new law will wipe out federal student debt for anyone who was a part of the chain between its inception in 1995 and its fall in 2015. The agency claims that it will wipe out $5.8 billion of debt for over 560,000 borrowers. This is the largest single loan discharge in the history of the Education Department.
Miguel Cardona, Education Secretary, stated that every student who has been deceived, defrauded, and forced into debt by Corinthian Colleges, can rest assured that they have the support of the Biden-Harris Administration and will pay off their federal student loans. “Corinthian has been engaged in financial exploitation of students for far too long. They deceived them into taking on more debt to pay off promises they wouldn’t keep.”
Tens of thousands of Corinthian students are eligible for debt cancellation. However, they must file paperwork and navigate a process that advocates claim is complicated and not well-known. The relief will now be automatic and extended to other borrowers.
Education Department officials stated that those who still owe Corinthian debts will be eligible for a refund on any payments made. However, the refunds will not be given to loans that are already paid in full.
