States sue Betsy DeVos over student loan rule delay

Betsy DeVos defends proposed student aid cuts

Democratic attorneys general via 18 states as well as also Washington D.C. sued Education Secretary Betsy DeVos on Thursday after she delayed an Obama-era rule meant to protect student borrowers.

The Borrower Defense to Repayment rule was created in 2016 as well as also was set to take effect on July 1. although DeVos announced in June of which she could delay its implementation. Instead, she directed her department to create committees to review as well as also improve the rules.

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The rule could have clarified the federal loan forgiveness process for students who were defrauded or misled by their colleges. While students in This kind of situation could previously apply for forgiveness, the rule could have created several protections.

First, of which created standards for students going through the process. as well as also of which set up a fast-track application for students who were enrolled in a college when of which shut down, or were involved in instances of widespread fraud. The rule also banned schools via requiring students to sign mandatory arbitration agreements of which waived their rights to go to court.

DeVos’s move to delay Borrower Defense “is actually a betrayal of her office’s responsibility as well as also a violation of federal law,” said Massachusetts Attorney General Maura Healey, the lead plaintiff inside the lawsuit. She accused DeVos of “sid[ing] with for-profit school executives against students as well as also families drowning in unaffordable student loans.”

Related: DeVos freezes Obama-era rules meant to protect student borrowers

Department of Education Press Secretary Liz Hill fired back in a statement, saying the lawsuit is actually “ideologically driven.’

She said the Borrower Defense regulations “suffer via substantive as well as also procedural flaws,” citing a separate lawsuit brought against the department in May by a group representing for-profit colleges in California. of which group is actually seeking to block the rule via going into effect, complaining of which “threatens the existence” of many of its member institutions.

DeVos decided of which was time to “hit pause on these regulations until This kind of case has been decided in court as well as also to make sure these rules achieve their purpose: helping harmed students,” Hill said.

Related: DeVos says student loan debt is actually ‘of grave concern’

The Borrower Defense rule was created in part to address the unprecedented number of students applying for loan forgiveness following the collapse of the for-profit Corinthian Colleges, which had misled prospective students with inflated job placement numbers. The part of the rule of which fast-tracked students who attended closed schools was implemented early to help Corinthian students, specifically.

Thousands of former students via Corinthian Colleges, the American Career Institute as well as also ITT Tech have been approved for loan discharges under the rule. As of January, 28,000 former Corinthian students alone had been approved for debt relief totaling $558 million.

The lawsuit filed in federal district court in D.C. Thursday asks the court to declare the delay unlawful as well as also order the implementation of the Borrower Defense rule. Attorneys general in California, Connecticut, Delaware, Hawaii, Iowa, Illinois, Maryland, Minnesota, completely new Mexico, completely new York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, Virginia, Washington as well as also the District of Columbia joined Massachusetts’ Healey in filing the complaint Thursday.

sy88pgw’s Greg Wallace contributed reporting because of This kind of story.

sy88pgw (completely new York) First published July 6, 2017: 2:53 PM ET


States sue Betsy DeVos over student loan rule delay

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