Articles Posted in Student loans

Normally, a teacher who qualifies for Teacher forgiveness after five years of service at a low income Title I school, cannot also obtain Public Service Loan Forgiveness using that time.  That won’t matter for someone who has less than $17,000 of federal student loan debt which is the cap for the Teacher forgiveness, but most borrowers that we talk to, have much more debt than that.  To be an educator, often one or even two masters degrees, are encouraged.  That comes at a pretty steep cost.

I’ve just learned that the PSLF Waiver now allows this time to count for PSLF as well as Teacher Forgiveness.  Under the normal rules, it does not.

• If you got Teacher Loan Forgiveness, the period of service that led to your eligibility can count toward PSLF if you certify PSLF employment for that period

It just occurred to me that our quarterly column, the “Student Loan Sidebar,” which appears in our local newsletter called the Cramdown which is sent to fellow bar members and our judiciary for the Middle District of Florida, Tampa Division, is something that everyone may want to see.  These are linked on our home page with no pay wall here.  This version is a little easier to read as it is exactly as it shows in the printed copy.  The Spring version is up now, and the Summer copy will drop any day now.  The full copy of the Cramdown by the Tampa Bay Bankruptcy Bar Association can be found on its website here.

These are regular student debt updates that I have been writing for a few years.  They are directed to our local bar association and include the recent happenings and what attorneys need to know about student loans (for themselves, or their clients).  They are only 1-2 pages in length, have practice pointers and are designed to raise awareness of what the Department of Education has been up to, or recent cases that are likely to impact local folks.  They are easy reads.  Lawyers who don’t practice in the student loan field, don’t know a lot about student loans.  You don’t have to know a lot about your loans to read these, nor do you have to be an attorney.

I know the Borrower Defense to Repayment Program has undergone so many changes, and been impacted by political and practical concerns that sometimes none of us knew which way was up, however, the recent Sweet settlement gives hope!  And some much needed finality.  (Remember the settlement is not yet final and could change)  Here’s a Facebook note posted by Nic Brown who has been a very vocal advocate in helping others obtain student debt relief.  His actions to encourage others to speak out, be a class member for various class actions and file claims where warranted, kept the pressure on.  I’m sure many who followed in his footsteps will finally be debt free!

Nic’s story:

In 2008 I graduated from a “college” that promised me a lot in the beginning and ended up being nothing more than a fraud at the end.

On Friday, the Senate passed a bill that would provide relief to thousands who have been trapped in a long battle with the Department of Education after a married couple had the misfortune of consolidating their loans.  While at first blush that may have seemed like a good idea, the joint spousal loan was not eligible for some of the best relief out there including income-driven plans and public service forgiveness.  We’ve tried to correct this problem by filing an adversary action in bankruptcy to obtain a similar result for our clients who were simply told “no” by the Department.  We were successful in doing so, up until the DeVos administration backtracked on us.

The Joint Consolidation Loan Separation (JCLs) Act of 2021 will:

• Allow borrowers to submit an application to the Department of Education to split the JCL into two separate federal direct loans.

This week, the parties in Sweet v. Cardona filed a motion with the court that they had reached a settlement in principle to resolve the case. As a quick refresher, this case challenged 1) the Department’s failure to issue timely adjudications on borrower defense claims and 2) the Department’s blanket denials of thousands of borrower defense claims during the DeVos administration.

We will learn more in the coming days about the contents of the settlement, but I have every reason to be optimistic that it will be pretty darn good.  So stay tuned.

In the meantime, if you’ve attended a for-profit school and was defrauded in any way, please file a Borrower Defense to Repayment application here:  https://studentaid.gov/borrower-defense/