Court Ruling Allows Loan Forgiveness for Defrauded Students

A U.S. District Court judge has lifted the suspension of a rule that would allow defrauded student borrowers to have their federal loans forgiven.

Betsy DeVos

The 2016 borrower defense rule is a process created by the Obama Administration that allows misled and defrauded student loan borrowers to have their federal loans discharged.

The court ruled that the Education Department acted illegally when it suspended the rule in 2017 before it could take effect, according to the release.

The rule will remain in effect until at least July 1, 2020.