Court Approves $6 Billion In Student Loan Forgiveness For 200,000 Borrowers To Resolve Lawsuit
ForbesDec 24, 2022
The Facts
On Wednesday, a US federal judge granted final approval of a settlement that will lead to an estimated $6B in student loan forgiveness for over 200k allegedly defrauded student-loan borrowers. The agreement was initially approved by the Education Dept. in June.
The lawsuit, Sweet v. Cardona, was filed in 2019 by student-loan borrowers who accused the Education Dept. of failing to process or arbitrarily denying their student loan forgiveness applications under the Borrower Defense to Repayment.
The Spin
Democratic narrative
The finalization of this settlement is a victory for Americans overburdened by student debt. Finally, borrowers defrauded by universities will get the loan forgiveness they're entitled to, and the mountainous backlog of debt relief claims will be addressed. This is a clear win.
Republican narrative
Biden has given the Education Dept. a reckless blank check to write off billions of dollars of debt without Congressional approval. A large percentage of debt is held by doctors, lawyers, and other well-paid professionals. This settlement is unfair to the American taxpayers who are footing the bill and the schools that are deemed guilty without due process.
