Article Summary –
The US Department of Education has announced that $6.1 billion in student loans for 317,000 students of the now-defunct Art Institutes will be forgiven due to the institution’s falsification of data and misleading students about career prospects. The Department revealed that payments made towards these loans will be refunded, as part of nearly $160 billion in student debt forgiveness approved by the Biden administration. The Trump administration had been more skeptical of student debt relief, with Trump opposing such measures even after his presidency ended.
Department of Education Announces Massive Student Loan Forgiveness
The Department of Education revealed on May 1 that $6.1 billion in student loans are being forgiven for 317,000 people previously enrolled at the now-closed Art Institutes. President Joe Biden condemned the institution for misleading students and cheating borrowers.
Existing borrowers will receive notifications from the department that their loans have been discharged and no further action is required. Payments already made towards federal student loans related to the Art Institutes will be reimbursed.
Among the affected schools were the Art Institute of Wisconsin in Milwaukee and the Art Institutes of Philadelphia and Pittsburgh in Pennsylvania.
An investigation into the Art Institutes’ practices found exaggerations in advertised graduate employment rates. They even included the income of tennis star Serena Williams, an alumnus of their Ft. Lauderdale school, in calculations.
Under the Biden administration, about $160 billion has been approved for student debt forgiveness, aiding 4.6 million borrowers so far. Biden expressed commitment to borrower relief and holding fraudulent institutions accountable.
On the other hand, the previous administration under President Donald Trump and Education Secretary Betsy DeVos, showed skepticism towards student debt relief. They halted loan forgiveness claims processing and narrowed eligibility rules, affecting the number of students who could benefit.
In opposition to student debt relief, Trump applauded a Supreme Court ruling in 2023 that struck down a Biden administration plan aimed at assisting a projected 43 million individuals.
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