Navigating Kaplan Student Loan Forgiveness Programs
Student loan debt can be a significant burden, and understanding available forgiveness options is crucial. This article explores various student loan forgiveness programs, focusing on those relevant to Kaplan students and related settlements.
Recent Settlements and Forgiveness Initiatives
Recent developments have brought significant relief to many borrowers, particularly those who attended certain institutions, including Kaplan. A settlement filed in federal court for the Northern District of California is set to provide automatic loan forgiveness for approximately 200,000 borrowers, representing about 75% of the plaintiff class. This settlement involves over 100 schools, largely for-profit institutions, technical, and vocational schools.
The Department of Education has identified these schools as warranting "presumptive relief" due to "strong indicia regarding substantial misconduct," whether credibly alleged or proven, and the high rate of class members with applications related to these schools. Some of these institutions, such as Westwood University and ITT Technical Institutes, are now closed. Others, like the University of Phoenix and DeVry, remain operational. Notably, Kaplan, now Purdue University Global, and Ashford University, recently acquired by the University of Arizona and relaunched as its global campus, are also included.
These findings against the colleges date back more than a decade. For instance, DeVry was found to have made misleading claims about employment opportunities to students between 2008 and 2015.
Reconsideration for Denied Applications
The settlement also includes reconsideration for borrowers who previously received form denials, treating their applications as continuously pending since submission. This provides a renewed opportunity for those initially denied relief.
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Borrowers Not Covered by Automatic Approval
Approximately 68,000 lawsuit participants who took out loans to attend schools not on the included list will not receive automatic approval under this settlement. They may need to explore other avenues for loan forgiveness.
Department of Education's Stance
Education Secretary Miguel Cardona stated that the Biden-Harris Administration is committed to addressing longstanding issues related to the borrower defense process. The Department of Education has already approved federal student loan discharges for borrowers who were enrolled in Kaplan Career Institute’s Medical Assistant and Medical Billing & Coding programs from July 2011 through February 2012.
Student Defense Vice President Alex Elson expressed satisfaction with the Department's decision to grant relief to defrauded Kaplan borrowers, emphasizing that such action should not have required a lawsuit. Eileen Connor, President and Director of the Project on Predatory Student Lending, added that the Department has an obligation to cancel debts where there is evidence of wrongdoing.
Group Borrower Defense Claim
In April, Student Defense, the Project on Predatory Student Lending, and the National Consumer Law Center sued the Department of Education for its failure to rule on a group borrower defense claim filed in May 2016 by Massachusetts Attorney General Maura Healey, on behalf of former Massachusetts students at Kaplan Career Institute. This highlights the ongoing efforts to advocate for borrower rights and ensure that legitimate claims are addressed.
Understanding Loan Forgiveness
Student loan forgiveness can significantly reduce or eliminate your debt. There are various full and partial forgiveness programs available, as well as options tailored for public service workers and teachers.
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Accessing Information
The first step is to access the studentloan.gov dashboard and gather the necessary documents to assess your eligibility for different programs.
Qualification Criteria
There are multiple ways to qualify for loan forgiveness based on your career field, employer, and specific loan criteria.
Public Service Loan Forgiveness (PSLF)
The PSLF program offers the possibility of loan forgiveness after 120 qualifying payments for those working in public service. To qualify for PSLF, borrowers must have federal Direct Loans and work full-time for a qualifying employer in public service.
Teacher Loan Forgiveness
Teachers may be eligible for up to $17,500 in loan forgiveness, depending on their years of service and the subject they teach.
Federal Family Education Loan (FFEL) Program
The FFEL program involved private lenders providing loans guaranteed by the federal government. While the program was discontinued in 2010, borrowers with existing FFEL loans can still repay them under various repayment plans. Borrowers can also choose to consolidate them into a Direct Consolidation Loan.
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It's important for borrowers with FFEL loans to understand the specific terms and conditions of their loans and to explore available repayment and forgiveness options.
Pre-College Financial Planning
Pre-College Financial Planning helps students and families make informed decisions about how to fund higher education before taking on loans. Due to the constantly evolving nature of loan programs, it is advisable to book a consultation to get an up-to-date understanding of your specific situation.
Bankruptcy and Student Loans
While a discharge in bankruptcy can eliminate many debts, student loans are generally not dischargeable. However, there are exceptions, and it's essential to consult with an experienced bankruptcy attorney to explore your options.
Addressing Errors on Credit Reports
You can correct errors on your credit report by sending a letter to the Credit Bureau with a description of the error and a request to correct it. The Credit Bureau must correct your report within 30 days or explain why the report is correct.
Reaffirming a Debt
After filing for bankruptcy, a creditor may ask you to reaffirm a debt. Reaffirming a debt means you sign a legally enforceable document promising to repay all or a portion of the debt.
Filing for Bankruptcy
Filing bankruptcy on your own is risky. You may unknowingly submit incomplete information, miss deadlines, or attempt to file under the wrong chapter. This could result in your case being dismissed without debts being discharged.
The Debt Collective and Advocacy
Organizations like the Debt Collective are actively working to advocate for group-wide cancellation of student loan debt. By sharing your experiences and information, you can contribute to their efforts to push for government recognition of the harm caused to borrowers and the need for loan cancellation.
Filling Out Information Forms
Filling out forms related to loan forgiveness does not guarantee cancellation, but it helps to strengthen the argument for group-wide cancellation. The information collected is used to create analytical data and reports to be sent to the Department of Education.
Understanding Sweet v. Cardona
The Sweet v. Cardona lawsuit is relevant to borrowers who have filed a Borrower Defense to Repayment (BDTR) application. The timing of your application determines whether you are part of the full class, post-class, or not included in the lawsuit.
Important Disclaimer
This information is not a Borrower Defense to Repayment application, nor a legal document. If you have federal student loans and have not yet filed for Borrower Defense to Repayment (BDTR), it is in your best interest to do so as soon as possible.
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