Trump Administration Proposes to Gut the Borrower Defense Rule
“The message to students behind today’s proposal to rewrite the 2016 borrower defense rule is loud and clear: you’re on your own. It would deny nearly $13 billion in relief to students.
“If finalized, the Trump Administration’s proposal would erect substantial new barriers to relief for students defrauded or otherwise abused by their colleges. It fails to protect students against misconduct that is illegal under state law. It imposes new evidentiary burdens on harmed borrowers, so that very few will get the relief they are entitled to by law. Perversely, the Department’s primary proposal is to require desperate borrowers to intentionally default – with all its negative consequences – before even seeking relief, forcing them to gamble on an unsympathetic bureaucracy.
“Students whose schools close while they’re enrolled would also have fewer options. The Administration’s proposal would deny students the choice of starting fresh without student loans, instead forcing them to complete their programs at a college chosen by their failing school.
“The Administration’s proposal does not go far enough to prevent colleges from abusing students, and more unaffordable and defaulted student loans are the predictable consequences of this regulatory rollback. Ignoring the abuses of students by colleges isn’t just unwise, it’s also contrary to the values and priorities of the American public, which overwhelmingly supports canceling loans of students deceived by their colleges.
“As the rule enters its public comment period, students and their allies now have only 30 days to urge the Administration to reconsider this ill-advised proposal and to implement the 2016 rule without further delay.”
The proposal, if finalized, would apply to students borrowing after July 1, 2019. Members of the public can comment within 30 days of formal publication by submitting online at regulations.gov. The proposal does not affect the pending applications of students of Corinthian, ITT, and other failed colleges. The backlog of students seeking relief is approximately 100,000.
