Tag: student loans

Education Department Ends Biden Student Loan Bailout

The Trump-McMahon Department of Education (DOE) has moved to end the last of the Biden administration’s large-scale, illegal federal student loan bailout programs.

DOE announced its agreement with Missouri to end the Saving on a Valuable Education (SAVE) Plan, which was set to cost taxpayers almost $350 billion in a decade’s time. The Dec. 9 press release celebrated the move as being not only a win for taxpayers, but necessary clarity for borrowers duped by extravagant and unrealistic Democrat promises.

Why should waitresses, construction workers, plumbers, and other hardworking Americans pay off the college degrees of strangers? The federal government already funnels far too much money into higher education as it is. In fact, federal involvement in universities is what has driven up prices and spread wokeness for decades.

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New Illinois Law Going Into Effect January 1st Will Make Illegal Aliens Eligible for Student Financial Aid

The state of Illinois is about to make it possible for illegal aliens to access state and local student financial aid. Governor J.B. Pritzker has already signed the law and it goes into effect on January 1st of 2026.

This is happening as the Trump Justice Department is suing various states over this exact issue. Student financial aid that is meant for American citizens should not be going to people who are in the country illegally.

This is an issue that goes directly to the core of what Trump has run on repeatedly.

Breitbart News reports:

Illinois Law Granting Student Financial Aid to Illegal Aliens Goes into Effect January 1

A law signed by Gov. JB Pritzker (D-IL) that will make illegal alien students eligible for state and local financial aid–which detractors say will reduce grants and scholarships for citizens and legal residents–is set to go into effect January 1, 2026.

Pritzker signed House Bill 460 into law in August. It grants illegal aliens eligibility for grants, scholarships, stipends, and other state-funded student aid.

“If you live in Illinois and are pursuing higher education, you should have access to the same opportunities as your peers,” Illinois state Sen. Celina Villaneuva (D-Chicago) stated.

Advocates for illegal aliens believe that the law will help illegal alien students, who do not qualify for federal aid because they are not in the country legally, and that the state and local aid will boost their chances of going to college and joining the state’s workforce.

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Report: Ilhan Omar ‘in Collection Proceedings’ for Her Student Loans, Is Seeking to ‘Bully’ Her Way Out of Payments

For most Americans, a U.S. lawmaker with onerous student loan debt pushing for debt forgiveness would be viewed as a conflict of interest.

For at least one U.S. representative, it’s apparently a non-issue — and the American Accountability Foundation is livid about it.

According to the Daily Wire, Democratic Minnesota Rep. Ilhan Omar has been accused by the watchdog group over a number of issues.

In a scathing letter sent to House Speaker Mike Johnson, American Accountability Foundation President Thomas Jones outed Omar’s dubious finances — and “bully” reputation.

“We are writing today to share serious concerns about abuse of office and abuse of government loans by a member of the House of Representatives, Representative Ilhan Omar,” Jones said.

According to Jones, Omar is actually in collection proceedings on her federally guaranteed student loans.

Citing her financial disclosures, Jones called out the fact that Omar “currently has between $15,001 and $50,000 in outstanding loans.”

Jones noted, “As you know, these loans are guaranteed by the United States Government and Representative Omar’s default would shift the cost of her student loans onto the U.S. taxpayer.”

“The fact that someone making $174,000 as a Member of Congress cannot pay their student loans is unconscionable and embarrassing.”

Jones wasn’t done, however, as he had more issues with Omar than just the poor stewardship of her money.

“Adding insult to injury, there are credible claims that she is using her influence as a Member of Congress to bully the Department of Education into not collecting the past-due payments,” Jones wrote. “We have promulgated a Freedom of Information Act request for correspondence from Representative Omar to fully understand the scale of her abuse of office.”

To ensure that the Treasury Department will not be on the hook for Omar’s defaulted student loans, Jones demanded a drastic move from Mike Johnson.

“We are calling upon you to instruct the Chief Administrative Officer of the House of Representatives to impound Representative Omar’s Congressional salary and pay it out to Nelnet, the servicer of her federal student loan, until such time as her payments are current.”

The Daily Wire posted the whole letter online, which can be read here.

Social media naturally had a field day with this news, especially those who are fed up with Omar’s far-left rhetoric.

But the discourse over Omar’s finances did not originate with this inquiry.

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White House agrees to cancel student debt for millions of borrowers

The Trump administration says it is canceling student debt for millions of borrowers — a pivot from its previous moves to block some loan forgiveness plans.

In an agreement with the American Federation of Teachers, the White House will again start processing student loan forgiveness for eligible borrowers in two income-driven repayment plans — Income-Contingent Repayment and Pay as You Earn — until they expire.

President Trump’s “Big, Beautiful Bill” is slated to phase out those two programs by July 1, 2028. They have over 2.5 million enrollees total, a higher ed expert estimated.

“This is a tremendous win for borrowers. With today’s filing, borrowers can rest a little easier,” said Winston Berkman-Breen, legal director for Protect Borrowers, which acted as counsel for the teachers’ union.

“The US Department of Education has agreed to follow the law and deliver congressionally mandated affordable payments and debt relief to hard-working public service workers across the country, and will do so under court supervision. We fully intend to hold them to their word.”

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Trump admin targets ‘ghost students,’ AI scammers stealing tens of millions in federal college aid

The Department of Education is cracking down on “ghost students,” AI scammers and others whom they say have recently swindled of tens-of-millions of dollars from the federal government – including roughly $8.4 million alone from California community colleges.

Within California’s system of 116 community colleges, 31% of applications last year – or 1.2 million – were found to be likely fraudulent, according to data from the office of the chancellor for the college system.

What makes the system vulnerable is that anyone who applies is admitted and more students not having to attend class as a result of the increase in remote learning since the COVID-19 pandemic. 

The scammers, with the help of stolen identities, bots and artificial intelligence join classes and stay enrolled until they receive their financial aid checks, according to The Los Angeles Times.

“The biggest target for fraud rings tends to be community colleges and lower-cost institutions,” Jason Williams, an official with the Education Department’s Office of Inspector General, said on a recent agency podcast. “This is because their tuition costs are lower than other schools, which increases the student aid award balance for the fraudulent student.”

While prevalent in California, the problem of fake applications is nationwide, with reports of fraud rings in states including Illinois, Louisiana, Maryland, Missouri and Nevada. 

The Education Department reported in May nearly $90 million in disbursements recently to ineligible recipients across the U.S., including thousands of deceased individuals receiving some form of payment. 

In Mississippi, a mother and daughter team recruited anyone in the area willing to participate. They then used these identities to apply for student aid, register for classes and collect the checks when the money was disbursed. They were later put in prison after obtaining $2.5 million. 

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Education Department Finds $90 Million in Improper Student Aid Payments

The Department of Education has uncovered nearly $90 million in federal student aid that was disbursed to people who were not eligible, including thousands of deceased individuals, it said on May 28.

The agency released the findings on May 28 as part of a broader effort to restore oversight tools and reduce fraud in federal student aid programs. Officials said the improper payments occurred over the past three years and were tied in part to lapses in verification systems that had been paused.

“From start to finish—filling out the [Free Application for Federal Student Aid] form to loan repayment—the American taxpayer underwrites federal student aid programs,” Education Secretary Linda McMahon said in a statement. “We are committed to protecting and responsibly investing their hard-earned dollars.”

According to the department, more than $30 million of the improper payments went to recipients who were listed as deceased. A cross-check with the Social Security Death Index flagged the error. Officials said they have strengthened real-time data-sharing with the Social Security Administration to help prevent similar mistakes in the future.

Other cases involved identity fraud and immigration-related ineligibility. In March, the department resumed flagging suspicious Free Application for Federal Student Aid applications using data models designed to catch inconsistencies or signs of identity misuse. A recent review found that nearly $40 million in Direct Loans and $6 million in Pell Grants had been issued to people who did not qualify.

Officials said individuals granted immigration parole status—temporary permission to remain in the country—are not immediately eligible for aid. To better identify these cases, the department said it has received updated data from the Department of Homeland Security.

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Crackdown On Student Loan Defaulters To Begin With Benefit Seizure, Then Wage Garnishment

The U.S. government will begin seizing federal benefits from 195,000 student loan defaulters in June, with wage garnishment notices set to reach 5.3 million borrowers later this summer, the Education Department announced on May 5, marking the formal restart of involuntary collections after a years-long pause

The renewed enforcement effort begins with the Treasury Offset Program, which allows the federal government to intercept tax refunds, Social Security checks, and other federal payments to recover unpaid student debt. Borrowers affected by the program began receiving notices this week, the department said.

“Starting today, approximately 195,000 defaulted student loan borrowers will begin receiving an official 30-day notice from the U.S. Department of Treasury notifying them that their federal benefits will be subjected to the Treasury Offset Program,” the Education Department said in Monday’s announcement.

Following the notice period, administrative wage garnishment will begin later this summer for all 5.3 million borrowers who remain in default. Guaranty agencies have also been authorized to resume involuntary collections on defaulted loans under the Federal Family Education Loan (FFEL) Program, the department added.

The move officially ends a pandemic-era freeze first imposed in March 2020 under President Donald Trump and extended multiple times under the Biden administration. Although payments officially resumed in fall 2023, most collection efforts remained paused—until now.

In an April 21 statement previewing the shift, the department said the decision was necessary to “restore common sense and fairness” and protect taxpayers, citing data that only 38 percent of the 42.7 million federal student loan borrowers were current on their loans, while nearly 10 million were delinquent or in default. The remainder were in forbearance, deferment, or grace periods.

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Biden’s $475B student debt cancellation plan blocked as federal appeals court issues final decision

A federal appeals court delivered a crushing blow Tuesday to a more than $475 billion student debt cancellation program begun by former President Joe Biden, ordering the underlying regulation be blocked in its entirety.

The Eighth US Circuit Court of Appeals had partially blocked the loan forgiveness effort last year — but a three-judge panel at the St. Louis-based court issued a final judgment to a lower court prohibiting any part of the initiative from taking effect.

Judge L. Steven Grasz in a 25-page opinion ruled that Biden’s Education Secretary, Miguel Cardona, had “gone well beyond” his constitutional authority in creating the Saving on a Valuable Education (SAVE) plan.

“Rather than implying by omission or other ambiguities, Congress has spoken clearly when creating a repayment plan with loan forgiveness or otherwise authorizing it — explicitly stating the Secretary should cancel, discharge, repay, or assume the remaining unpaid balance,” Grasz wrote, finding “no comparable language” in the SAVE Plan.

In 2023, the Penn Wharton Budget Model estimated the so-called “repayment plan,” which Grasz said allowed for student debt to be “largely forgiven rather than repaid, would cost taxpayers $475 billion over the next decade.

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Biden Withdraws Plan to Cancel Student Loan Debt For 38 Million Americans, Blames “Operational Challenges”

Joe Biden withdrew plans to cancel student loan debt for 38 million Americans and blamed “operational challenges.”

“In making this decision, we considered the Department’s ability to implement the proposed rules if they were finalized in a form identical or largely similar to what was included in the NPRM. With the time remaining in this administration, the Department is focused on several priorities including court ordered settlements and helping borrowers manage the final elements of the return to repayment following the Fall 2024 end of the 12-month on-ramp period designed to assist borrowers who were unable to make their payments or who needed more time to access information to determine the right repayment plan for their circumstances,” the Department of Education said on Friday.

In a separate announcement on Friday, Joe Biden approved of an additional $4.28 billion in student loan forgiveness for nearly 55,000 public service workers.

President Trump will immediately unwind Joe Biden’s unconstitutional student loan forgiveness program, Politico reported.

Last month a federal judge gave Joe Biden a win a few weeks before the election and said he can move forward with his student loan forgiveness plan.

US District Judge in Georgia, Randall Hall, a George W. Bush appointee allowed a restraining order against the Biden-Harris Regime’s student loan forgiveness scheme to expire.

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King Biden & Queen Harris Overrule Supreme Court On Student Debt Forgiveness

Biden repeatedly acts like he is above the law. So who’s the threat to Democracy?

The Wall Street Journal reports Biden Snubs the Courts Again on Student Loan Forgiveness

‘That didn’t stop me,” President Biden declared after the Supreme Court blocked his $430 billion student loan write-off in 2023. It sure didn’t. After striking out in court with three debt forgiveness schemes, the Administration on Friday unveiled another. Take that, judges.

The Education Department says its proposed rule would authorize forgiveness for some eight million borrowers experiencing “hardship.” Under the rule, the department can discharge debt if it calculates a borrower has an 80% likelihood of defaulting on payments within the subsequent two years based on 17 factors such as income, debt balances and assets.

The rule would effectively let the department forgive debt of any borrower any time it wants. The administration says high child-care costs could qualify as a hardship. How about high auto loan or credit-card payments? Did someone say moral hazard?

In April the department released a plan that cancels accrued interest for 25 million borrowers and forgives debt of those who entered repayment over 20 years ago or who “enrolled in low-financial-value programs”—meaning, forprofit colleges. The plan also promised to waive debt for borrowers with a “hardship.”

A federal court last month blocked that plan, but the department says its new rule “would operate separately and distinctly.” Courts are playing whack-a-mole with the Administration’s debt write-offs that end-run Congress, which never authorized such broad-based debt forgiveness.

Such lawlessness is one reason so many Americans discount the left’s assertions that Donald Trump endangers democracy. Mr. Biden acts like he’s king, and Democrats and media voices cheering him on have no standing to object if Mr. Trump follows the Biden precedent.

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