Republicans are poised to destroy President Obama’s student loan relief program aimed to help defrauded students who took out loans with shady for-profit colleges.
As soon as January, a Republican-led Congress along with President Donald Trump can spearhead legislation that would block Obama’s regulations and leave countless students saddled with unfair debt from fraudulent learning institutions.
Obama’s measures, issued by the Department of Education, laid out specific loan relief procedures just a few days before the election.
However, because of a 1996 law called the Congressional Review Act, the new Republican Congress can challenge and defeat those measures.
The GOP stood in opposition to the program when it was proposed. Chairman of the Senate Committee on Health, Education, Labor, and Pensions, Lamar Alexander, is currently considering action necessary to overturn the “Borrower Defense” rule in Obama’s program.
To make matters worse, even if Republicans fail in Congress, Trump can still instruct agencies to be much more restrictive in the interpretation of this rule, designed to ease student loan burdens.
Unfortunately, students who attended the now-defunct Trump University do not qualify for loan relief because they did not qualify for federal loans.
Coincidentally, after Trump won the election, stocks of for-profit education corporations rose.
“The fact remains that students need some sort of process for student loan discharge in the case of a school closure or fraud,” said Justin Draeger, president of the National Association of Student Financial Aid Administrators. “I’m not sure it’s as easy as simply voiding the entire regulation.”
Like Obamacare’s fabled “replacement,” don’t hold your breath for a viable Republican solution on this issue anytime soon.
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