Debt Relief, student loan debt, Student Loans

President Trump Vetoes Student Loan Forgiveness Bill

A recent move by President Trump has student loan borrowers, as well as Veteran’s and Consumer groups, concerned and disheartened after he sided with Education Secretary Betsy DeVos and vetoed the bipartisan Borrower Defense to Repayment legislation.

The Borrower Defense to Repayment program is a student loan forgiveness program that was created during the Obama administration as part of an effort to provide debt relief for students who were taken advantage of by predatory colleges and for-profit universities.  Many of the borrowers who fell prey to these predatory tactics were veterans.

According to figures from the Institute for Veterans and Military Families at Syracuse University, 20 percent of all GI Bill recipients attended a for-profit institution. In addition, approximately half of the complaints filed by defrauded borrowers were filed by veterans who attended for-profit schools. Many of these schools have now folded, including ITT Technical Institute and Corinthian Colleges, leaving borrowers with no degrees- just student loan debt.

After the 2016 election and DeVos’s appointment, the administration began to systematically dismantle the regulations that governed the Borrower Defense program. Borrowers responded with lawsuits, but these legal proceedings did not stop DeVos from requiring borrowers to meet an even more difficult standard before receiving relief. DeVos created a new rule that required borrowers to prove that their college made deceptive statements “with knowledge of its false, misleading or deceptive nature or with reckless disregard for the truth.” A three-year limitation to bring a Borrower Defense claim was also brought, which barred thousands of borrowers who originally took out these loans several years ago.

Congress quickly responded to DeVos’s rule by drafting legislation that would overturn this new student loan forgiveness rule. The House quickly passed legislation doing just that in January in a bipartisan vote of 231-180. The legislation then went onto the U.S. Senate where it passed 53-42. However, lawmakers were not surprised Friday when President Trump vetoed this legislation, even though it had clear bipartisan support.

While the ability to veto is well within the President’s power, it will now fall to Congress on how to proceed next. Under the Constitution, Congress can override the president’s veto, but many see this as unlikely. Regardless, the House does plan on moving forward with attempting to override the veto and could vote as early as July 1.

For borrowers who are struggling with student loan debt, relief options are available.  Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. There are ways to file for bankruptcy with student loan debt.  It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.

Source: Forbes.com

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