The Burgeoning Student Loan Strike

The number of students refusing to repay the loans they took out to attend a for-profit college swells to 100 -- and meeting with U.S. officials gives them a boost.

April 1, 2015

WASHINGTON -- A big red box of paperwork that activists delivered to federal officials here on Tuesday may hold the key to debt relief for large numbers of students who attended Corinthian Colleges.

The group of former Corinthian students refusing to repay their federal loans, which has now grown to 100 people, met Tuesday with top officials from the U.S. Department of Education, the Consumer Financial Protection Bureau student loan ombudsman and representatives from the Treasury Department.

The so-called debt strikers gave Education Department officials documents from 257 borrowers, each making a legal case for why they shouldn’t have to repay the federal loans they took out to attend Corinthian-owned campuses. Much of the massive for-profit college has been sold and is facing lawsuits from federal and state regulators. At least 100 more submissions are on the way, organizers say. 

The forms submitted to the department Tuesday rely on a little-known and rarely used provision of federal law and department regulation that allows borrowers to cite a college’s misconduct as a reason why they shouldn’t have to repay the federal loans they took out to attend that college.

The debt strike group has been gathering such claims from former Corinthian students on their website. An online form automatically links the experience that a former Corinthian student describes -- such as being misled by job placement rates -- with the appropriate section of state law that it violates.

Under Secretary of Education Ted Mitchell, who attended Tuesday’s meeting, has previously said the department is “carefully considering” how to make it easier for Corinthian borrowers to obtain relief from their federal loan obligations by asserting that their college violated state-level consumer protection laws.

Department officials haven’t yet announced any decisions on that issue, nor have they responded to a request by a group of Senate Democrats for clarity on how borrowers can utilize that provision of federal law.

Denise Horn, a spokeswoman, said in a statement after Tuesday’s meeting that the department “will review every claim to borrower’s defense and continue to investigate Corinthian to help students as much as possible.”

The students refusing to repay their loans said that Tuesday’s meeting was a significant step in their effort to get the government to cancel Corinthian students’ loans.

“This was a huge legitimization of our strategy,” said Astra Taylor, one of the organizers. She said it was a step forward for the movement for the Education Department to sit at the table and hear the individual reasons and hardships behind the students refusing to repay their debt.

Aside from pushing the department to declare some of the loans legally unenforceable, the group is also asking officials from the Departments of Treasury and Education to use other discretion they have to write down the debts, according to Luke Herrine, a third-year law student at New York University who serves as the group’s legal coordinator.

The group gave officials a proposal for clear and understandable options for students to receive debt relief as well as more proactive notifications from the Education Department about those options. Herrine said the department committed to responding to their requests within the next month.

Michael Adorno, of Alexandria, Va., was one of the debt strikers at the meeting. He joined the movement last month after reading news stories about the original group of 15 students refusing to repay their loans.

Adorno, 33, graduated from a Corinthian-owned Everest campus in Colorado Springs in 2012 with an associate degree in computer and information sciences.

He took out more than $37,000 in federal loans, but he said his degree has been worthless for getting the type of job he was promised, as a systems administrator for the military or a federal agency.

He says he’s been deferring his loans for years as he lived paycheck to paycheck while working at a child care center and then a fast-food pizza store. Adorno said he doesn’t envision ever being able to repay his loans unless he gets a bachelor’s degree -- which he says he can’t afford.  

 “I understand there’s no overnight decisions any of these entities can make, it has to go through the bureaucratic process,” he said. “Hopefully they’ll make the right decision to give a lot of us the chance to go back to school and get a degree that means something.”


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