Biden Cancels $37M In Student Debt For Just 1200 People

Loan forgiveness is being offered to around 1,200 former University of Phoenix students.

According to reports, students who studied at the university between September 21, 2012, and December 31, 2014, will have their $37 million in debt erased as part of a settlement announced by the Biden administration.

The loans were canceled for borrowers who filed claims under the ‘borrower defense to repayment’ program, ensuring that people get compensation if they feel they were scammed or misled by the institution they attended.

The Department of Education is basing its decision to cancel student loans on an FTC investigation against the institution.

The FTC was looking into whether or not the University of Phoenix lied about its relationships with major employers, which would allegedly lead to preferential treatment when applying for jobs.

Reports show that in a 2019 settlement, the for-profit college admitted no wrongdoing.

Richard Cordray, chief operating officer of Federal Student Aid, stated that the University of Phoenix blatantly used misleading advertising to enroll students. Students who had faith in the institution and aspired to improve themselves via higher education were left with debt and worthless degrees.

The University of Phoenix countered that with its own statement.

The representatives stated they firmly disputed the U.S. Department of Education’s claims about the University of Phoenix’s resolution with the Federal Trade Commission in December 2019. The University will not stand in the way of legitimate claims by debtors seeking relief, but it will fiercely dispute all false or questionable claims using all available legal means.

According to reports, formal letters about the debt forgiveness will be sent out to qualifying former students within the next month.

The United States Department of Education wrote off $130 million in student debts in July, benefiting 7,400 students.

Over 2,300 debtors who enrolled in Ashford University in California had $72 million in loans forgiven by the Department of Education in August.