DOE action means total of $48.8 million in loan cancellations for NJ student borrowers
TRENTON – Acting Attorney General Matthew J. Platkin announced today that the U.S. Department of Education’s decision to discharge all remaining federal student loan obligations for students who were defrauded by Corinthian Colleges will allow 4,660 New Jersey borrowers who attended Corinthian schools to receive a total of $48.8 million in full student loan cancellations.
Earlier this month, the Department announced it would discharge all remaining federal student loans borrowed to attend any campus owned or operated by Corinthian Colleges Inc. from its founding in 1995 through its closure in April 2015.
Nationwide, the federal government’s action means that approximately 560,000 borrowers will receive $5.8 billion in full loan discharges.
Corinthian intentionally targeted low-income, vulnerable individuals through deceptive practices and false advertising that misrepresented job placement rates and school programs, among other misconduct. In the wake of intense scrutiny by federal and state agencies, Corinthian abruptly ceased operations in 2015.
The Murphy Administration has been steadfast in fighting for loan cancellations for New Jersey and other students defrauded by Corinthian, and has been joined by other states in that advocacy.
“The conduct of Corinthian Colleges was deceptive and cruel. They left many students in New Jersey and across the nation saddled with heavy debt, without either the education or the employment opportunities they were promised,” said Acting Attorney General Platkin. “The Department of Education’s decision to discharge the loans of these students was righteous and just, and will enable these student borrowers to begin anew without having to shoulder unfair debt put on them by predators.”
Borrowers who are eligible for the loan relief do not have to take any action – the cancellation will be automatically applied to their student loan balances.