Students who attended the Corinthian Colleges, the now defunct for-profit chain that operated schools and programs in New York, are getting help from New York Attorney General (AG) Eric Schneiderman.
Last month, Schneiderman announced that his office began notifying around 3,000 New York residents who attended programs run by Corinthian about the cancellation of their federal student loans. The U.S. Department of Education ruled that Corinthian Colleges misrepresented employment success among students who graduated from the for-profit chain.
“Corinthian Colleges used false promises of career success to lure students, leaving many with enormous debt and few job prospects,” said Schneiderman in a press release announcing the initiative. “My office is committed to helping these students receive much-deserved relief from their student loan debt.”
Corinthian operated for-profit colleges Everest Institute and Everest University in Rochester, New York. Both schools abruptly shut their doors in 2015, leaving students on the hook for their debt with no accompanying degree. The Department of Education’s investigation found the for-profit colleges had inflated graduate employment successes in some of the school’s programs.
Students who were enrolled in these specific programs are eligible for their federal student debt to be discharged as a result of the misrepresentations. Schneiderman said that efforts on part of the New York AG’s office will focus on reaching students who were enrolled in these specific programs during the relevant time period. The AG also noted that any student who attended one of the Corinthian schools and thinks they were misled about potential jobs upon graduation can apply to get their loans discharged.
Schneiderman isn’t alone in reaching out to student loan borrowers. The AG said 43 other states and the District of Columbia are taking part in similar efforts. If included in the outreach effort, students in New York will get a letter and loan discharge application. If the cancelation gets approved, then students should be refunded for payments already made on their loans, and they will not be liable for the remaining loan balance. Because the approval process to get the loans discharged may take time, Schneiderman said borrowers should continue to make payments on their loans.
While this crop of Corinthian students is protected from misleading, for-profit advertising, this luxury may not last under the new Secretary of Education, Betsy DeVos. The President Trump appointee not only has ties to the for-profit industry through investments, but she also refused to commit during Senate confirmation hearings to keep regulations on the books holding for-profit schools accountable for their graduates’ employment success. Failure to do so would result in losing federal financial aid, but this may not hold up in the future.
While DeVos hasn’t had too much time to make a mark on the Department of Education, her appointment has led to fear and dread among college students. In a recent LendEDU poll, 42 percent of college students thought DeVos would have a negative impact on the repayment of their student loans. In the same LendEDU survey, 66.8 percent of student loan holders told LendEDU that her lack of experience with student loans would impair her ability to tackle the problem. The negative view on the country’s newest Education Secretary doesn’t end there. The same LendEDU poll found that 33.8 percent of survey respondents didn’t think DeVos would have any impact while just 24.2 percent thought she would bring positive changes to the more than $1.3 trillion in student debt.
Author: Andrew Rombach
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