Posted on July 25, 2018
WASHINGTON, D.C., July 25, 2018 — Senate education committee Chairman Lamar Alexander (R-Tenn.) today released the following statement after the U.S. Department of Education released a new regulation on borrower defense to repayment:
“Secretary DeVos is right to propose new regulations that set important safeguards and clear standards for when a student can file a claim, so taxpayers aren’t paying for unreasonable or unsubstantiated claims of fraud. Federal law allows students to petition the U.S. Department of Education to have their federal student loans forgiven if they believe their college engaged in misconduct or otherwise misled them. The Obama Administration went too far in rewriting this provision by setting overly broad and vague standards and as a result, put taxpayers on the hook for too many loans.”
“Borrower defense to repayment,” is a regulation that allows a student to file a claim with the Department of Education to have their federal student loans forgiven if the student believes they were defrauded or misled by their college. The Obama Administration issued a regulation to expand the process under which students could file claims. The Obama regulation was too broad, vague, and confusing and led to the Department forgiving the loans of students without determining whether they were harmed by the college.