Higher Education Inquirer : debt collective

Showing posts with label debt collective. Show all posts

Wednesday, August 30, 2023

Student Debt Relief Tool (Debt Collective)

Yesterday, we launched a new tool that files an appeal to the Department of Education to cancel each borrower’s student debt. All of the debt. Automatically. With the flick of a pen.

This type of tool has never existed before—until we created it and launched it yesterday. In the first 24 hours, more than 5,000 borrowers completed the tool.

If you haven’t filled out the tool yet, do it now so we can keep up our momentum. If you haven’t shared with a buddy or three, please pass it on. We want to reach our goal of twenty thousand applications submitted by Labor Day!

Fill out the Dispute Tool

Friday, February 10, 2023

People's Rally for Student Debt Cancellation to be held outside Supreme Court, February 28, 2023

[Update: This event will be livestreamed at https://www.cancelmystudentdebt.org/peoples-rally-livestream ]

Sign up for the People's Rally for Student Debt Cancellation to be held outside the US Supreme Court, Tuesday morning, February 28, 2023. And please share this event with people in your network.

The Supreme Court case involves the constitutionality of President Biden's order to cancel more than $400 billion in student loan debt, that according to the NY Fed would provide a disproportionate amount of relief to low and middle-income families.

Supporters of the People's Rally include the Debt Collective, NAACP, National Urban League, American Federation of Teachers, National Education Association, SEIU, the National Consumer Law Center, Young Invincibles, and Move On. Senator Elizabeth Warren will be one of the speakers.

While there is no substitute for People on the ground, folks can also attend online.

Before the hearing, the People are invited to use the #CancelItSCOTUS! hashtag and flood Twitter with personal and shared stories of why the cancellation is so vital. Access the toolkit to join the Twitterstorm on 2/28 at 9-11am.

Currently, there are about 45 million Americans carrying student loan debt. Based on our interpretation of the 2022 Financial Student Aid Annual Report, about 40 percent of the federal student loan debt portfolio ($674 Billion of $1.7 Trillion) is unrecoverable.*

Meanwhile, student loan debt collectors like Maximus receive hundreds of millions of dollars from the US government while sometimes using unethical and predatory business practices.

Students who attended subprime schools or who had low financial value majors have been hardest hit. And the debt takes its toll on millions of citizens, their families, and their communities--and reduces their opportunities to live the American Dream.

About 200,000 student debtors who were defrauded by subprime schools are also facing a legal battle in the 9th Circuit Court to have their debt forgiven. Hundreds of thousands more have filed Borrower Defense to Repayment claims and are awaiting for decisions that can take several years, due to understaffing and an enormous backlog at the US Department of Education.

So far, ED has only approved Borrower Defense to Repayment claims from a handful of closed schools, and it appears that victims of fraud from other subprime schools, like the University of Phoenix, have received blanket denials.

Pushing back against the debtors, Republican lawmakers are calling for mandatory loan repayments to restart.

Stay tuned to this post for more information. #strikedebt

*We have asked the US Department of Education press team for a comment, but they have not responded, which is often the case.

Tuesday, January 17, 2023

Need Student Debtors to Provide Information about Low-Financial-Value Postsecondary Programs (Updated February 15, 2023)

[Editor's Note: The public comment period ended February 10, 2023.]

The US Department of Education is accepting public comments as a Request for Information (RFI) about "Public Transparency for Low-Financial-Value Postsecondary Programs." The announcement is available at the US Federal Register.

The URL to make these comments is at

https://www.regulations.gov/document/ED-2022-OUS-0140-0001

As with most US government rules and policies, industry insiders have great influence in these decisions--and concerned citizens are often shut out of the process. When consumers do have a chance to speak, they may not even know of those opportunities. That's why the Higher Education Inquirer is asking student loan debtors to contribute to this RFI while they can.

Tell DC policymakers and technocrats about your unique struggles (and your family's struggles) tied to student debt--and what could be done to better inform consumers like you.

There you can find public comments that have already been made. As of February 15, only 129 comments were posted.

According to the announcement:

"a misalignment of prices charged to financial benefits received may cause particularly acute harm for student loan borrowers who may struggle to repay their debts after discovering too late that their postsecondary programs did not adequately prepare them for the workforce. Taxpayers also shoulder the costs when a substantial number and share of borrowers are unable to successfully repay their loans. The number of borrowers facing challenges related to the repayment of their student loans is significant."

The Request for Information continues...

"Programs that result in students taking on excessive amounts of debt can make it challenging for students to reach significant life milestones like purchasing a home, starting a family, or saving enough for retirement, ultimately undermining their ability to climb the economic mobility ladder. Especially for borrowers who attended graduate programs, debt-to-income ratios often rise well above sustainable levels. IDR (Income-Driven Repayment) plans also cannot fully protect borrowers from the consequences of low financial-value programs. For instance, IDR plans cannot give students back the time they invested in such programs. For many programs, the cost of students' time may be at least as significant as direct program costs such as tuition, fees, and supplies. Loans will also still show up on borrowers' credit reports, including any periods of delinquency or default prior to enrollment in IDR."

"The Biden-Harris Administration is committed to improving accountability for institutions of higher education. One component of that work is to increase transparency and public accountability by drawing attention to the postsecondary programs that are most likely to leave students with unaffordable loans and provide the lowest financial returns for students and taxpayers."

CECU, an group representing for-profit colleges, has an organized effort to protect its interests.

Meanwhile, Robert Kelchen has provided an EXCEL spreadsheet that provides many answers. The dataset covers 45,971 programs at 5,033 institutions with data on both student debt and earnings for those same cohorts. We found more than 12,200 programs where debt exceeds income. And more than 7200 programs resulted in median incomes of less than $25,000 a year with debt greater than $10,000.

While some of these high-debt programs in medicine and law may eventually be profitable, many more paint a picture of struggle with a lifetime of debt peonage. Cosmetology schools had a large number of low-income programs. But the fine arts, humanities, social sciences, and education also produced low-value programs in terms of debt to income ratio.

Some of subprime schools HEI has been investigating (Purdue University Global, University of Arizona Global, The Art Institutes) had a number of low-value majors. But elite and brand name schools like Duke, Drexel, Emory, Syracuse, Baylor, DePaul, New School, and University of Rochester even have high debt and low-income programs.