During the final days of the Bush administration in late 2007, Congress implemented the Public Service Loan Forgiveness program under the Department of Education, which was designed to offer loan forgiveness to those who chose to work in public service for 10 or more years. This past week, over 150 members of Congress wrote a letter to Secretary of Education Betsy DeVos urging her to look into the Public Service Loan Forgiveness program.
“We are deeply troubled that millions of dedicated public servants may not obtain the loan forgiveness that they deserve if the Department does not act quickly to correct program implementation issues,” the letter said.
In spring 2017, the student loan ombudsman of the Consumer Financial Protection Bureau (CFPB), Seth Frotman, and his team researched the program and discovered that nearly 99 percent of the applications for the Public Service Loan Forgiveness Program were denied. This means the Department of Education and loan companies were advocating for people fresh out of college to work in the public sector, promising them they would be able to get loan forgiveness in ten years through the Public Service Loan Forgiveness Program. After 10 years, those same students would apply for the program, and only one percent of those applicants would be accepted, leaving the other 99 percent with thousands of dollars of debt still needing to be paid off.
This is absolutely deplorable. Not only has the government failed students searching for ways to afford college, but they have hung seasoned public servants out to dry.
On Aug. 27 of this year Frotman, submitted a formal letter of resignation. Frotman claimed that the Trump administration was responsible for preventing the CFPB from protecting the interests of those borrowing money and that the administration has “turned its back on young people and their financial futures.” Frotman claims that there have been serious changes made by the CFPB’s new director, Mick Mulvaney, and that none of them have the best interest of the American consumers in mind. Rather, Frotman believes that the company has shifted away from impartiality and now seems to follow the Trump administration’s agenda instead of that of hardworking U.S. citizens.
This is atrocious — not only is it a complete failure of the system that the U.S. is not able to follow through on their promise of forgiveness, but it is also a misstep on the part of the Department of Education not to be investigating this issue. To have this information out there for students, despite the fact that the government cannot support the financial commitment the program offers, leaves thousands over their heads in debt without a way out. It is the responsibility of Betsy DeVos and her department to investigate this issue and see that they are not leading more students astray with the promise of forgiveness on their loans.
Now, it seems as though an Obama-era loan forgiveness program offering forgiveness to defrauded borrowers may be the only thing able to help these thousands who have been duped by the Public Service Loan Forgiveness Program. Perhaps it’s time for DeVos to stop rolling back and delaying Obama-era policies. Instead she should look into how to help these defrauded citizens who have dedicated their lives to the public sector and are now not getting anything in return.
Students — make sure you always read the fine print and do your research before you take out loans or sign yourself up for a program based solely on promises. As it seems, the Department of Education isn’t planning to do anything to protect you anytime soon.