A new federal report finds that record-keeping failures may have left thousands of Americans stuck with student debt that should have been forgiven.
- Record-keeping failures by the federal government may have left thousands of Americans saddled with student debt that should have been automatically canceled through a benefit for low-income borrowers, according to a new federal study.
Investigators said they couldn’t verify why the loans hadn’t been forgiven — gaps in the Education Department’s data made it impossible to know for sure. But they suggested it could be the result of poor record-keeping. Among more than $1 trillion in student debt held by the federal government, about half is being repaid through those plans.
Under the department’s new action, borrowers in income-driven plans will get all of their past monthly payments counted toward loan forgiveness, even if they weren’t in an eligible repayment plan at the time. Borrowers who had long stretches in forbearance will also get that time counted toward forgiveness, even though it typically is excluded.
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