ATTORNEY GENERAL RAOUL URGES DEPARTMENT OF EDUCATION TO IMPLEMENT ITS PROPOSED REGULATIONS WHICH WILL PROVIDE DEBT RELIEF TO FEDERAL STUDENT LOAN BORROWERS

ATTORNEY GENERAL RAOUL URGES DEPARTMENT OF EDUCATION TO IMPLEMENT ITS PROPOSED REGULATIONS WHICH WILL PROVIDE DEBT RELIEF TO FEDERAL STUDENT LOAN BORROWERS

May 21, 2024

Chicago - Attorney General Kwame Raoul joined a coalition of 18 attorneys general calling on the U.S. Department of Education to swiftly implement its recently proposed regulations that would provide needed relief for some of the nation's most burdened student loan borrowers.

In their comment letter to the department, Raoul and the coalition of attorneys general urge the implementation of regulations that would waive or reduce student loan repayments for certain groups of federal student loan borrowers.

"I urge the Department of Education to implement the proposed regulations as expediently as possible to ensure affected borrowers see much needed student loan relief," Raoul said. "I will continue to advocate on behalf of borrowers and hold predatory lenders accountable."

Raoul and the coalition underscore the critical need for meaningful debt relief to address the nationwide student debt crisis, which disproportionately burdens low-income borrowers and borrowers of color. Having worked on the frontlines advocating on behalf of student borrowers, Raoul and the coalition of attorneys general have observed firsthand how historical and ongoing systemic failures of the federal student loan system have exacerbated and perpetuated the crisis. Drawing on these experiences, Raoul and the coalition emphasize the need for borrower relief and commend the department for proposing regulations designed to help alleviate burdens for struggling borrowers.

Specifically, the department's proposed regulations are designed to provide critical debt relief to:

• Borrowers who have seen their student loan balances balloon through accrued and capitalized interest, and borrowers with older loans.These borrowers have been especially burdened by the misconduct of student loan servicers and the department's previous misguided policy choices.
• Cohorts of borrowers with commercially held loans taken out under the Federal Family Education Loan (FFEL) Program. The department proposes a system that would allow some borrowers with commercially held FFELs to obtain debt relief. While FFELs stopped being issued in 2010, many borrowers with FFELs continue to be burdened by their debt. Some FFEL borrowers are in danger of missing the opportunity to consolidate their loans to access affordable income-driven repayment plans and loan forgiveness programsdue to widespread servicer misconduct. Borrowers with FFELs should consolidate by June 30^th to benefit.Debt relief is critical for these borrowers and the coalition encourages the department to further extend such relief.
• Borrowers who attended a school that failed to meet its obligations to students. Under the proposed regulations, the department will provide debt relief to borrowers who attended schools that lost their Title IV eligibility because of institutional problems related to student outcomes, and schools that failed to provide sufficient value to their students according to departmental determinations. These borrowers did not get the benefit of the education they were promised for the federal loans they took out and should not be left holding the bag for institutional failures.
• Borrowers who would have been eligible for relief under other federal student loan programs,such as income-driven repayment plans and the Public Service Loan Forgiveness Program, but have not successfully enrolled in these programs, often due to the difficulties they face navigating the complex federal loan repayment system.

Joining Raoul in submitting the comment letter are the attorneys general of California, Colorado, Connecticut, Delaware, the District of Columbia, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, Vermont and Washington.