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Biden administration cancels $1.1 billion student loan debt for ITT Tech students

Student Loan Forgiveness
Posted at 3:30 PM, Aug 26, 2021
and last updated 2021-08-26 19:31:22-04

The US Department of Education announced Thursday that it would cancel $1.1 billion in student loan debt for some students from the now-defunct ITT Technical Institute.

According to a press release, an additional 115,000 borrowers will see their student loans canceled after a new review of existing regulations.

ITT Technical Institute filed for bankruptcy in September 2016. It shut down 130 campuses nationwide, affecting more than 35,000 students and more than 8,000 employees, amid lawsuits and investigations over alleged aggressive recruiting tactics.

"For years, ITT hid its true financial state from borrowers while luring many of them into taking out private loans with misleading and unaffordable terms that may have caused borrowers to leave school," said U.S. Secretary of Education Miguel Cardona in a news release. "Today's action continues the Department's efforts to improve and use its targeted loan relief authorities to deliver meaningful help to student borrowers. At the same time, the continued cost of addressing the wrongdoing of ITT and other predatory institutions yet again highlights the need for stronger and faster accountability throughout the federal financial aid system."

The number of loan discharges approved under President Joe Biden since January 2021 is $9.5 billion, affecting over 563,000 borrowers.

The department said the majority of the borrowers did not complete their degree or credential and left ITT on or after March 31, 2008.

The department said they'll begin processing discharges for those who qualify starting in September.