Students who went thousands of dollars into debt to attend Corinthian Colleges have been targeted for delinquency by the Department of Education. A move by Massachusetts Senator Elizabeth Warren may give these borrowers the reprieve they need. Warren's office has been in contact with the Department of Education and is working to halt the seizure of Social Security benefits, tax refunds, and other garnishments of the now-defunct Corinthian Colleges.
The letter from Warren makes use of data provided to her office by the Department of Education. It states that almost 80,000 borrowers took out loans to attend the for-profit college after promises of excellent job placement rates. It was later revealed, though, that college officials inflated these numbers to bring in as many students as possible. Many of these students are now facing debt collectors and damage to their credit.
Undersecretary of Education Ted Mitchell responded to the letter and echoed Warren's concerns. He said the Department of Education will work with borrowers to provide debt relief. It may be possible for many of the borrowers to have their loans discharged due to the fraudulent nature of the school while helping others to stop the garnishments or tax refund seizures.
Several students have applied for the loan discharge program, and many more are taking advantage of it as they learn of its existence. The Department has fast-tracked many of these applications.
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