Aug. 27 (UPI) — The U.S. Department of Education on Thursday announced plans to cancel $1.1 billion in student debt for 115,000 borrowers who attended ITT Technical Institute.
The announcement provides relief to students who attended ITT, a now-defunct for-profit college, but did not complete their degree or credential, and left on or after March 31, 2008.
According to the Education Department, 43% of these borrowers are currently in default of their loans as they attended the school during a period in which it misrepresented its financial health and guided students into pursuing costly private loans.
“Today’s action continues the department’s efforts to improve and use its targeted loan relief authorities to deliver meaningful help to student borrowers,” Education Secretary Miguel Cardona said.
Eligible borrowers will automatically have their loans forgiven under Department of Education regulations if they did not enroll in another institution within three years of the school’s closure.
“The majority of ITT borrowers covered by today’s action did not enroll elsewhere during the three years after ITT’s closure and will not need to take any further action to receive a discharge,” the department said.
In March, the Education Department announced plans to roll back a Trump administration policy that granted only partial student loan relief to students defrauded by for-profit colleges.
The department said it would instead implement a more “streamlined approach” which it estimated will eliminate about $1 billion in student loan debt from about 72,000 students, many of whom attended ITT and Corinthian Colleges.
In Thursday’s announcement, the Education Department said it has now forgiven $9.5 billion in loans for 563,000 borrowers.
Earlier this month, Cardona announced the department would automatically discharge $5.8 billion in student loans for more than 323,000 borrowers who have total and permanent disabilities.
President Joe Biden and his administration, however, have still faced pressure to further cancel $50,000 per borrower in student debt for all.
Biden has requested that the Education Department and the U.S. Department of Justice review his legal authority to forgive student debt through executive action but the results of that review have not been made public.