WASHINGTON – The United States Department of Education, under the leadership of President Joe Biden, recently announced that the 18,000 students who have been defrauded by ITT Technical Institute will have their student loans canceled. In total, over $ 500 million in student debt has been written off, representing an average of nearly $ 28,000 per borrower.
The move is part of the borrower advocacy program, which offers a loan repayment discount to students who believe they have been misled by a higher education institution. The Biden administration has so far canceled $ 1.5 billion in student loans for about 90,000 borrowers under the program.
Former ITT students said the for-profit institute, which closed in 2016, has made false claims about job prospects, as well as the possibility of transferring credits. The Department of Education found that the institute had distorted the earning potential that an ITT degree would grant them; in fact, ITT graduates have said that including their tenure on a resume makes it more difficult to get a job.
“Many of these borrowers have waited a long time for relief, and we must work quickly to render decisions for those whose applications are still pending,” Education Secretary Miguel Cardona said in a statement. “This work also emphasizes the need for continued accountability so that institutions can never again commit this kind of pervasive deception.”
While defrauded ITT graduates have had their loans canceled, millions of other Americans are still paying off their student loans. Wider student loan cancellation measures are always out of reach, so don’t wait for your loans to be paid off if you’re struggling to pay off your college debt. Instead, take advantage of record student loan refinance rates for save money on your private student loans.
How to know if student loan refinancing is right for you
Refinancing a student loan can help some borrowers pay off their loans faster and save money with a lower interest rate, but it’s not for everyone.
It is not advisable to refinance federal student loans, for example, because it means you will lose federal protections such as income-based reimbursement and COVID-19 forbearance without interest. It can even make you ineligible if the federal government decides to write off student loan debt in the future.
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Student loan borrowers with private student loan debt, however, should consider refinancing when rates are at record highs. This can reduce your student loan payment or help you pay off your private loans faster. Student loan cancellation does not apply to private loans, so there is no risk of losing benefits by refinancing them. You can compare student loan refinancing rates through multiple lenders at once using Credible’s online marketplace.
Still not sure if refinancing is a good idea?
Refinancing a student loan can save borrowers thousands of dollars over the loan repayment. It’s important to weigh the pros and cons and keep in mind that this does not apply to everyone’s personal financial situation.
Those who refinanced their shorter-term private student loans using Credible saved on average $ 17,344. See if refinancing a student loan is a smart move for you by using a student loan repayment calculator.
And if you still have questions, get in touch with an experienced student loan consolidation agent to Credible for more.
For more, see FOXBusiness.com.