TICAS Celebrates Newly Released Higher Education Regulations

“Today, the U.S. Department of Education released final regulations aimed at better protecting students recruited and enrolled by predatory institutions, making repayment more affordable, and protecting student borrowers’ access to court. We celebrate this student- and borrower-centered set of regulations, as well as the effect they will have on the field of higher education.

“The new Borrower Defense to Repayment (BD) rule marks a milestone in a years-long effort to create a straightforward path to debt relief for student borrowers who are deceived, misled, and defrauded by predatory institutions. The rule also makes it simpler for groups of students with similar claims to receive relief and affirms the Department’s ability to pursue the return of taxpayer dollars credited to students from the institutions at fault — introducing accountability for defrauding students. When it takes effect July 1, 2023, the new BD rule will establish needed guardrails and enhance accountability for career education programs defined by law.

“We have long championed strengthening the process for loan discharges for students whose schools closed. Today, we applaud the Department’s regulations to provide automatic relief for affected students.

“We welcome today’s additional improvements in regulations:

• Streamlining the Total and Permanent Disability Discharge process, as well as adding eligibility for borrowers who have received Social Security Disability Insurance or Supplemental Security Income for five years prior to application.
• Eliminating interest capitalization where not required by law, which will reduce the overall cost of repaying student loans for many borrowers and help limit balance growth.
• Banning the inclusion of pre-dispute arbitration requirements and class action waivers in enrollment agreements, which will preserve the legal rights of students at for-profit institutions.
• Protecting borrowers who take on debt when their institution falsely certifies the student’s loan eligibility.

“Lastly, we applaud the Department’s ongoing efforts to strengthen the Public Service Loan Forgiveness (PSLF) program. These new regulations will build on the promising advances made by the limited PSLF waiver and ensure public service workers can continue to access relief.

“Collectively, this package of regulations shows a strong commitment to students and borrowers, and we are grateful for the work of Department of Education officials, lawmakers and their staff members, negotiators, and other advocates who helped shape them into a strong set of guidelines. We look forward to their timely, full implementation in the coming year.

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