The Biden administration in June promised complete relief for student loan borrowers from Corinthian College, a move that would affect some 500,000 people following the school’s fraud scandal.
But since then, debtors tell The Hill that the process has been fraught with inconsistencies, confusion, finger-pointing and a lack of communication from the Education Department about their loan relief.
Some borrowers and advocates worry that the program will take months if not years to kick in while the kinks are worked out between loan service providers and the administration.
In June, Vice President Harris announced student-loan-debt relief for borrowers from Corinthian College, which shut down in 2015 for allegedly defrauding its students.
The for-profit school had more than 100 Everest, Herald and WyoTech campuses across the U.S. before an investigation found the school was inflating job placement rates and lying to students about the ability to transfer credits.
After its shuttering, Corinthian borrowers could apply for Borrower Defense to Repayment, which allowed some students to receive debt relief due to the school’s wrongdoing.
Harris’s announcement, however, said that all Corinthian borrowers would get complete debt relief whether they applied for Borrowers Defense or not.
The move was touted as a victory by the administration in the following months.
Two days after the announcement, Education Secretary Miguel Cardona tweeted that Corinthian borrowers “had $5.6B in loans immediately forgiven.”
But immediate forgiveness has been sporadic and the relief process has been confusing for the borrowers.
In a Facebook group titled “Loan Discharge: Corinthian Colleges/Heald/Wyotech/Everest,” borrowers have aired their frustrations for months.
Megan Caplan, a 34-year-old mother in the group who went to an Everest College, told The Hill she has received no communication from the Department of Education since the June announcement.
She received a letter from her loan servicer in July saying her account was in forbearance, meaning she would not have to pay the loans, but has had no communication with them since.
Other Corinthian borrowers who have been in contact with their loan servicers and the Department of Education say they’re met with finger-pointing and conflicting answers.
Kevin, a 54-year-old who graduated from an Everest College, said “every time I call [my loan service provider], all they tell me is we have no information and we have to wait until we get information from the Department of Education.”
Kevin applied for Borrower Defense in 2018.
In a screenshot provided to The Hill, the Federal Student Aid Office told Kevin via live chat that it “sometimes can take weeks, months or years” before a Borrower Defense application is approved.
In terms of a timeline for debt relief after the administration’s June announcement, the official said they did not have that information and “the discharge for Corinthian College is being done in waves.”
Still, the effort has not been completely bungled.
Some Corinthian borrowers have received loan relief. Some members of the Corinthian Facebook group said they logged into their student loan accounts one day to find their loans were forgiven — but with no notification.
An attorney who works with student borrowers told The Hill they are seeing Corinthian borrowers who submitted Borrower Defense applications over the years get the debt relief first.
But complications arise when Corinthian borrowers have not filled out the Borrower Defense application. The process becomes more complicated when information like borrowers’ identities, the kind of loans a borrower has and what refunds borrowers are eligible for need to be figured out, according to the attorney.
Becky, a 41-year-old who went to Everest…
Read More: Corinthian College borrowers were promised immediate loan relief. They’re still waiting