Judge Approves Settlement in Sweet v. DeVos

Student loan borrowers who sued the Department of Education after it changed requirements for the the Borrower Defense to Repayment program have secured a victory in the courts. A federal judge has approved a preliminary settlement agreement in Sweet v. DeVos that would force the department to process some 170,000 loan forgiveness applications that had been cast aside.

As Forbes notes, the department made the changes after Betsy DeVos took over as Education Secretary in 2017. The new rules make it much more difficult for students to obtain loan forgiveness. Tens of thousands who had already submitted applications were suddenly ineligible under the new framework.

“Under the terms of the settlement agreement, the Department of Education would have 18 months to process the outstanding, unprocessed Borrower Defense applications that have been submitted,” Forbes reports. The department would also have to waive any interest accrued while the applications were pending. The department would have to discharge additional debt if it fails to process the applications by the deadline or if it continues to engage in “forced collections” on impacted loans.

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