Question

The department of education recently issued a report claiming that graduates of for-profit colleges and universities are much less likely to repay federal student loans. Therefore the government has restricted student loans to such institutions claiming that they have committed fraud. What is the assumption that the government has implicitly made in this case and do you agree?

Answer 1

Government has restricted student loans to such institutions claiming that they have committed fraud. Yes,According to me government has taken good steps in giving loan to students because in many cases Student found guilty. They are using Education loan for another purposes instead of using for education purposes.

So, What the rules mean for students in terms of Educational Loan?

“Today’s regulations build on [the Obama administration’s] progress by ensuring students who were lied to and mistreated by their school get the relief they are owed, and that schools that harm students are held responsible for their behavior,” said US Secretary of Education John B. King, Jr. in a statement.

Last year, Corinthian College closed or sold all of its campuses while facing allegations of fraud. The Education Department received more than 15,000 claims from students and alumni who had student loans from the school.

The forgiven loans totaled over $247 million, and that process spurred federal officials to create new processes to help victims of education fraud get rid of their debt.

The new regulations will create an automatic discharge of student loans belonging to borrowers whose school closed on or after November 1, 2013 and who have not enrolled in another Title IV participating institution within three years.

Additionally, the regulations eliminate previous agreements that prevented students from suing schools over misconduct. Under the new rules, students who are the victims of fraud or misconduct can seek justice in the form of a lawsuit.

And students who were unable to complete their degrees due to school closure will also be re-eligible for federal Pell Grants, even if they used up their Pell Grant totals at the closed school.

For victims of misconduct or fraud:

If you attended a school that the government cited for fraud or has closed, you may be eligible for student loan discharge. That means the government and the schools could eliminate your remaining student loan balance.

If your school closed, you can submit a claim for closed school discharge. If your school committed fraud, misrepresented its services, or otherwise violated state laws, you may be able to get your loans forgiven through borrower defense to repayment.

But from my side, Government should initate some camapign and mission in order to educate and tell the benefits with regards for study and also jow to manage their lifystyle in this era.