Bipartisan Senate vote favors defrauded student loan borrowers

Wednesday, March 11, 2020

Today, the U.S. Senate voted 53-42 to overturn the U.S. Department of Education’s revised 2019 borrower defense to repayment rule. The bipartisan effort leaves the stronger 2016 rule in place, allowing defrauded students the right to discharge their federal loans. Set to take effect in July, the Department’s 2019 rule would have provided relief to only 3% of student loan borrowers due to a series of bureaucratic hoops intended to make it more difficult for the victims to obtain the relief afforded them under the Higher Education Act. Schools that acted illegally would be held accountable for reimbursing the government for a mere 1% of these loans. Currently, over 200,000 borrowers are waiting to hear from the Department of Education on whether their applications for student loan discharge will be granted.

“This is a happy day for thousands of student loan borrowers who have been the victims of fraud,” said Consumer Action policy advocate Alegra Howard. “The Department of Education’s 2019 rule gutted borrower protections for students and taxpayers. These students were promised a better future through education, yet were left with worthless degrees (or no degree) and saddled with debt. We are thankful to the bipartisan group of senators who used the Congressional Review Act to overturn the Department’s weak version of the borrower defense rule, and we hope the Trump administration will consider enacting more robust borrower protections moving forward.”

The Senate’s joint resolution is a companion to a resolution in the U.S. House of Representatives that passed 231-180 with bipartisan support in January. The resolution now must be signed or vetoed by President Trump.

For more information on borrower defense to repayment, or to see if you qualify for a federal student loan discharge, please visit the Department of Education.