A new ruling from a federal judge means the U.S. Department of Education has delayed student loan forgiveness for some.
The Attorneys general of 19 states, as well as the Districct of Columbia, sued U.S. Secretary of Education Betsy DeVos and the U.S. Department of Education for delaying a borrower protection rule scheduled to take effect on July 1.
Filed in the federal district court in Washington D.C., the lawsuit alleges that DeVos illegally delayed the borrower defense to repayment rule, which the Obama administration believed would allow defrauded student loan borrowers to receive student loan debt forgiveness.
The attorneys general alleged that DeVos violated the Administrative Procedures Act as she failed to meet the standard for a delay, properly notify or allow time for public comment. The lawsuit wanted the court to implement the borrower defense immediately.
In his 57-page legal opinion, U.S District Judge Randolph opined that the Education Department’s rational “was arbitrary and capricious.”
Said Massachusetts Attorney General Maura Healey said Thursday. Along with calling the lawsuit “ideologically driven”, the Education Department’s press secretary, Liz Hill, stated that “the state attorneys general are saying to regulate first, and ask the legal questions later.”
Borrower Defense to Repaying means students can have federal loans forgiven if a school employed illegal or deceptive practices to encourage the students to lead students to borrow to attend the school.
The ruling does not require the rule to be reinstated, but solutions are forthcoming.
The judge’s ruling does not require the rule to be reinstated, but remedies are expected to follow.
DeVos says the borrower defense to repaying rue and the borrower protection rule (also known as the gainful employment rule) are confusing and unfair.
“Fraud, especially fraud committed by a school, is simply unacceptable,” DeVos said in a statement in June. “Unfortunately, last year’s rulemaking effort missed an opportunity to get it right. The result is a muddled process that’s unfair to students and schools, and puts taxpayers on the hook for significant costs.”
DeVos added: “It’s time to take a step back and make sure these rules achieve their purpose: helping harmed students. It’s time for a regulatory reset. It is the Department’s aim, and this Administration’s commitment, to protect students from predatory practices while also providing clear, fair and balanced rules for colleges and universities to follow.”
Interviewed by The Sun as part of their You’re Not Alone suicide prevention campaign, Tracey Rogers and Dawn Scott warned of the mortifying link between suicide and debt.
Dawn, 61, and her husband Geoff, 62, say that interest on their son Ollie’s debt accrued so fast they never found out the true amount he owed.
They helped their son pay nearly $5,300 while he was alive and got charges totaling over $3,200 after his passing. Ollie couldn’t keep up with the payments since he was only making $230 a week at that time.
Ollie passed away after jumping in front of a train in September of 2011.
Dawn told The Sun, “He was very smart. He was spot on with everything from a young age. But he had an addictive nature. He couldn’t cope. He couldn’t face us. It’s terrible that it felt like that.”
“It’s strange. I could probably tell you how I felt that day seven years ago but I wouldn’t be able to tell you how I felt last week,” she added.
Tracey Rogers, 51, lost her son Jerome to suicide after he couldn’t pay two $85 parking tickets and the debt soon spiraled to over $1,300. Jerome, 20, worked as a freelance messenger and couldn’t afford to pay the money he owed.
After bailiffs began to follow Jerome, who lived with his family, he googled ways to end his life. His story was told in a BBC documentary called Killed By My Debt.
Tracey and her spouse, Bentley Duncan, helped Jerome pay about $650 of the debt and he set up a payment agreement of $168 a week. After he subtracted his expenses, Jerome was often broke.
In March of 2016, Jerome’s brother Nat, 28, found him hanged in the woods near his house. Jerome walked out of his family home the day before, texting his girlfriend he loved her and to never forget about him.
Tracey told The Sun, “He just didn’t have enough time to pay it. Jerome was given five weeks to pay. He wasn’t asked to show any evidence that he could afford the payments.”
It wasn’t until Jerome’s passing that Tracey found out the bailiff was sending her son text messages reminding him to make payments and warning him his motorcycle could be taken away if he broke the agreement.
“The bike was his job and his social life. Jerome was pushed right into a corner. There was no other reason for him to do it,” she added. “The bailiff industry needs to be brought into the 21st century.
“We are campaigning for bailiffs to be regulated by an independent body. We’ve also asked the councils to extend their payment times.
“Losing Jerome has affected us immensely. It’s something we’ll never get over,” she says. “We really miss him.”
Image: NBC News