Anonymous
|
ED-2016-ICCD-0075-0004
|
Two-Year Public
Institution of Higher Education
|
Please create a form that
is user friendly. So many students do not understand other ED
forms that are available. Also make sure it clear for all
parties. Good example would be the deferment forms. Great Lakes
will give student full Eco Hardship Deferment that show he or she
is on food stamp. Where FedLoans will only give six months for
Eco Hardship deferment depending on the student's food stamp
letter from the state.
Is the form going to give the
student resource? Will this form replace the FSA ombudsman
complaints form on Student Aid.ed.gov? Will the FSA ombudsman
complaint form become the new Borrower Defense to Loan Repayment?
How will the form educated the student on this? How will school
give out this form?
Will there be instruction on
it? Please make the instruction user friendly because this is one
of rest why people do not submit claim. Everyone hates reading
legal wording and some time the wording is too gray.
|
This borrower defense to
loan repayment (“borrower defense”) form will not
replace the FSA ombudsman complaints form. The borrower defense
form will be provided in three formats on the
Studentaid.gov/borrower-defense
website: HTML, fillable PDF and a form wizard that can be
submitted online. There are instructions regarding the
information that borrowers should provide, as well as a Question
and Answer section informing borrowers of their options regarding
forbearance. The Department also will update the borrower defense
website to provide further instructions to guide borrowers in the
process.
|
Clark Burnett
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ED-2016-ICCD-0075-0005
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Individual
|
This, and all documents,
should be available in:
1) MS Word fill-in-able
format, and/or
2) .pdf fill-in-able format.
(Apparently, Adobe Acrobat doesn't allow more than a certain
small amount of any given form to be fill-in-able on the license
- maybe 500 copies - so you will have to use other software or
get it developed in-house at OMB?)
Also/or (at a
minimum): 3) on-line format that is entered directly so that no
paper/printing is required.
Additionally, there
should be a way for electronic signature(s) (the IRS can do it so
any department can do it) so that people can fill these in by
typing, save an electronic copy, and email it in with no
paper/printing.
Why should we print out, fill-in by
hand, sign non-electronically, and scan for email or mail forms
when it could/should all be done on computer?
|
The borrower defense form
will be provided in three formats on the
Studentaid.gov/borrower-defense
website: HTML, fillable PDF and a form wizard that can be
submitted online. Borrowers will be able to sign the fillable PDF
and form wizard versions by uploading a file that contains their
signature.
|
Anonymous
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ED-2016-ICCD-0075-0006
|
Student
|
Collection Companies have
no limit on time when they can collect on Federal student loans.
Students shouldn't be limited at all on the defense for
repayment. There was rampant fraud by the for-profit college
industry for decades.
If the government can't
easily investigate/hold schools accountable in a reasonable
amount of time, how do you expect students to in a limited amount
of time?
Make the process easier, DO NOT limit the
time.
If you limit the time, remove the federal
guarantee.
If you can't hold for-profit colleges
accountable for fraud, remove them from the federal lending
program.
EDMC, CECO, ITT, and others are absolute
frauds, and they need to be held accountable. ACICS and other
accreditors allowed these scamsters to defraud students in
droves. Now students need the help of the government to get their
money back.
|
This comment is unrelated
to the information collection required for borrowers seeking to
file a borrower defense claim on this form.
|
Kristofer Fogg
|
ED-2016-ICCD-0075-0007
|
Military
|
Please,
no statute of limitations on Defense to Repayment. So many of us
thought we we had to live forever saddled with the debt so
carelessly heaped upon us by "colleges" that lied. Too
many people's lives have been ruined. Too many people were forced
to take out private loans that they could never pay back.
The
law, though vague, doesn't mention a statue of limitations.
|
This comment is unrelated
to the information collection required for borrowers seeking to
file a borrower defense claim on this form.
|
Anonymous
|
ED-2016-ICCD-0075-0008
|
Individual
|
As
a taxpayer, I hope that you will not implement the Department of
Education's proposed "Defense to Repayment Regulations."
When your own analysis shows a cost of somewhere between $2
billion and $40+ billion over ten years it shows that you really
have no idea how much of a tax burden these regulations will add
to the American people.
These regulations would lead to
costly and frivolous lawsuits at the expense of taxpayers and
would do little to help students by comparison.
A government
agency such as the Department of Education shouldn't even be
making a decision to create regulations that would add billions
of dollars to federal spending. Congress alone holds this
authority.
Please
do not implement these proposed regulations.
|
This comment is unrelated
to the information collection required for borrowers seeking to
file a borrower defense claim on this form.
|
Janet Shaw
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ED-2016-ICCD-0075-0009
|
Parent/Relative
|
The
cost of higher ED has been going up much faster than inflation.
WHY? More demand. More students who can pay more money. Why? Easy
student loans. Why? Government guarantees. So, Uncle Sam helped
make school loans too easy to get - more students borrowed -
schools hired more administrators to help students process the
loan applications... better paid professors, deluxe student
gyms... costs go up, up, up... and surprise, surprise... many
students have trouble finding jobs that pay well enough to pay
back the loans. How will a taxpayer bailout help? It won't. It
may help a few individual students. But, we - including those who
did not go to college - will pay for it and the incentives to
borrow more than you can afford will increase.
|
This comment is unrelated
to the information collection required for borrowers seeking to
file a borrower defense claim on this form.
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Fritz Anonymous
|
ED-2016-ICCD-0075-0010
|
Student
|
The
Defense for Repayment must be made available for every student
that has been defrauded by these corporations in the For Profit
College Sector. Unacceptable that these young students have been
force into a lifetime of debt and left with no real degree to
make a career out of. Some left with no degree at all, yet have
to repay their loans. There should be no statute of limitations
as they will have scammed millions and millions of dollars from
these students.
Here is my experience.
The
For-Profit Recruiting practice student protection law, was not in
place yet and they preyed on me. I was a poor single mother
family, high school graduate wanting to chase a dream in the art
field.
I filled out an online questionnaire while at the
public library doing school searches because I could not afford a
computer or the internet.
I was immediately contacted by
phone and asked a lot of personal questions especially about my
family situation
Then I was told to write a 300 word essay
on why I wanted to attend the school.
I visited the college
two times as they woo'd me with their facility (or lack there of,
once I began attending) in a "big city" downtown
college.
The sales pitch was that they were a premiere art
school ahead of the curve in industry standards focused on new
media, fashion and internet degrees but they were far from
it.
Fraudulent claims were made about the total cost
of the school.
Falsely stated their accrediting system, said
it would be retro-actively applied to my degree once they became
accredited. It will never be applied.
Dishonest statements
were made to me that I would have transferable credits to other
schools for a continued education/masters program.
Criminally
deceptive about never disclosing student housing costs and how
they weren't included in the school costs but they were added
into my student loans.
Lied about the location of student
housing in proximity to the school. It was over an hour away and
I was told that I wouldn't need a car. This forced me to find an
apartment that was located closer to the school/city ASAP.
Never
disclosed that the cost per credit hour rate inflated, if more
than one quarter was taken off, during their very demanding, 11
week, 4 quarter, year round system.
Never disclosed costs of
supplies, books and travel expenses.
The success of job
placement during and after school was falsely
represented.
Curriculum and technology was outdated. I had
to educate myself on what new technology was available, how to
use it and how it applied within my field of study, on my
personal time.
I had to switch majors and almost start over
my education due to their curriculum and technology being
outdated in the animation degree.
Went through four
financial advisers, all of which, made it seem like they had no
idea what was going on.
Funneled me to special interest
lenders
Once I officially became a student they were
complacent with my personal situation on funding, when they had
falsely expressed to me that they would work with me and my
situation throughout my schooling.
Never disclosed that I
couldn't file bankruptcy on my student loans.
They wouldn't
let me attend classes until the first payment was received by
their accounting department, from the very student loan lenders
they funneled me to. Sometimes this would be a week or two of
missing important studio classes, resulting in a lower grade due
to absenteeism.
Encouraged me to over apply for extra money
with my student loans for supplies/living expenses with a
continual need for cosigners because they would no longer accept
me as an individual loan applicant.
AI said I should work a
full-time job while in school to cover extra expenses. They did
not help in finding me employment. I had to find it myself, so I
found one within my field of study. However the 4 quarter
semester system made it next to impossible to do this without
rearranging how my classes were scheduled, with which my
curriculum was structured. Meaning I had to put certain classes
off, even though it was a prerequisite for other classes. I had
to work a 9-5 then go to all evening classes 5-6 days a week.
Did
not assist me in finding an internship. I found it myself.
There
was no support system in finding me a job after the completion of
my degree. I found my first job after submitting hundreds of
resumes.
There has been no follow up since graduation nor
any assistance since college.
|
This comment is unrelated
to the information collection required for borrowers seeking to
file a borrower defense claim on this form.
|
Randy
Kuykendall
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ED-2016-ICCD-0075-0011
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Private/For-Profit
Institution of Higher Education (Western Technical College)
|
These
comments pertain to the Borrower Defense to repayment NPRM issued
by the U.S. Department of Education (ED).
I
am the owner of a private, for-profit college that has operated
in my family for four generations spanning nearly fifty years. I
represent the third generation of same family ownership and
operation.
Since
ED has seen fit to promulgate a regulation with some sections
targeted specifically at for profits, I suggest that ED carry the
“targeted approach” one step further. Since it is
almost exclusively the large, publicly traded chains of schools
that are responsible for the issues at hand, I suggest that ED
make the regulations pertain to them and not impose a regulatory
strangle-hold upon those of us with family owned and operated,
quality oriented, and student focused operations with excellent
student outcomes.
I
don’t mind being held accountable for my own mistakes, but
I do object to being held accountable for the mistakes of others.
This NPRM is so broad in its application, it may well put our
fifty year institution out of business. It places our school in a
proverbial “catch 22” position where there is no way
to survive. Increased lawsuits means increased expenses to the
school. Increased expenses means higher tuition which directly
affects and endangers the colleges compliance with Gainful
Employment regulations and 90/10 provisions, not to mention the
student’s ability to afford the education.
This
rule would encourage lawsuits in an already overly litigious
society that is subjected to innumerable trial lawyer
advertisements proclaiming, among other things, that, “…you
are entitled to a cash settlement…”.
In
nearly five decades of operation, we have utilized arbitration
three or four times and have found it to be a very fair and
honorable way to resolve differences. It is also far less
expensive and time consuming than trials. Differences of opinion
are unavoidable in any kind of endeavor, college being no
exception. People don’t always agree. But to encourage the
use of so called “trial lawyers” against schools and
expecting a positive outcome is like hiring the foxes to guard
the henhouse and expecting the production of eggs to increase.
The colleges will spend much of their time and resources
defending a few students’ frivolous claims at the expense
of educating the majority students.
Recently
an article written by a former United States Secretary of
Education stated the following: “The new rule would open up
colleges and universities to an avalanche of lawsuits, many
frivolous or unwarranted. Specifically, the proposed rule would
forgive student loan debt if the college or university is ruled
to have made a “substantial misrepresentation” to the
student. That is a monumental shift from the traditional legal
definition of fraud, which requires an “intent to deceive.”
By removing intent, this change would open the door to lawsuits
for misrepresentations made by colleges or universities by
mistake or under circumstances it can’t control, like
underperforming students or the unavailability of well-paying
jobs.
To
make matters worse, under this change, these rulings would be
made by a Department of Education hearing examiner—not a
judge. Colleges and universities would have little chance of
appeal.” William J. Bennett –Ideas Education –
July 27, 2016.
Based
on excellent outcomes, our Accrediting Commission (ACCSC)
designated our college as a “College of Excellence”
for the past six years. Nevertheless, several years ago, two
graduates sued the college claiming that we did not provide them
with sufficient graduate employment opportunities. We
subsequently sent them numerous and very viable job leads and job
interviews through their attorney. They did not show up for any
interviews nor did they follow up on a single job lead. We
learned that they were both receiving some form of disability
income and if they went to work, they would lose it. The
frivolous case is being dismissed for want of prosecution
following their attorney’s loss of his license to practice
law. This example illustrates exactly the type of frivolous law
suits and disreputable attorneys that this regulation will
encourage.
This
regulation is unfair and lacks due process by providing that the
trigger for posting a letter of credit by the school is not a
judgement against the school, but the simple filing of a lawsuit,
no matter how frivolous it might be. How would ED feel if they
had to post a letter of credit every time a school filed suit
against them if there were no restrictions governing such events?
The NPRM also imposes unreasonable financial requirements on
schools by deeming them not financially responsible during
pending law suits based on the fact that an action has been
filed. Such an action demonstrates punitive intent, not
reasonableness. If ED really wants to target the unscrupulous
schools, I suggest that the final regulation allow arbitration
but require each school to report the number of annual
student/graduate arbitrations in their annual certified audit.
Those schools showing a pattern of arbitrations above a
reasonable threshold, which the regulation would set, would be
required to post a letter of credit for each year of
non-compliance and perhaps forego the right to further
arbitrations.
ED
also states in the NPRM that they decided to exclude traditional
schools from the repayment rate warning and disclosure
requirements because compliance would impose significant
disclosure burdens. Among schools with similar repayment rates
there is no justifiable legal, policy, or any other rationale
that supports imposing a significant disclosure burden on one
specific sector and not others.
ED
ignores the fact that nearly 30 percent of institutions with
equally bad or worse repayment rates of for-profits will not be
required to provide additional disclosures or warnings to
students. I, therefore request that ED either delete this new
repayment rate definition entirely or apply it to all
institutions of higher education.
Additionally,
the NPRM requires schools to maintain records of federal funds
disbursed indefinitely, thereby creating an extreme and seemingly
open-ended burden on schools in their efforts to maintain
compliance. Allowing an unlimited timeframe i.e. a total lack of
any statute of limitations for students to pursue borrower
defenses decreasing any school’s ability to adequately
respond to all claims whether meritous or frivolous.
Thank
you for providing the opportunity to comment,
Randy
Kuykendall
Western
Technical College
915
227-4261
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This comment is unrelated
to the information collection required for borrowers seeking to
file a borrower defense claim on this form.
|
Tim Anonymous
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ED-2016-ICCD-0075-0012
|
Student
|
All
of America's youth and people paying school loans should have
access to this knowledge some schools have made education purely
a business matter.
|
This comment is unrelated
to the information collection required for borrowers seeking to
file a borrower defense claim on this form.
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Norine Fuller
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ED-2016-ICCD-0075-0013
|
Institution of Higher
Education (Fashion Institute of Design and Merchandising)
|
Below
are the comments of the Fashion Institute of Design and
Merchandising (FIDM) on the proposed Borrower Defense
Regulations. FIDM is concerned that the attempt to clarify a
borrower's claim against repayment has resulted in a complex,
overly broad, legally tenuous and costly proposal.
I.
Basis for Borrower Defense Claim -
The Department
proposed three tests for its revised borrower defense claim:
A
favorable decision in a state or federal court of the defense
claim
Breach of contract by the school, and,
"Substantial
misrepresentation" by the school about the nature of its
educational program, its financial charges or the employability
of its graduates.
FIDM believes the last test to be
unsound and unreliable because it would:
Eliminate the need
to prove intent to deceive by the school.
Use
an extremely vague and subjective standard of evidence as a basis
for borrower defense against payment.
Make a reasonable
interpretation of meaning or intent by the school virtually
impossible.
Moreover, the determination that there has
been a "substantial misrepresentation" about the nature
of educational programs is based on a "preponderance of
evidence" which is itself driven by the Department's
determination of misrepresentation regardless of intent by the
school. In addition the Department may consider information
omitted by an institution's representative that might be
construed to make a school's representation of its programs
false, erroneous or simply misleading.
The recasting
of Borrower Defense claims makes it difficult for all schools
(not just schools of questionable quality or lacking adequate
financial resources) to serve students with any degree of
certainty that they are protected against arbitrary and
capricious legal action.
II.
Claim Resolution/Recovery of Funds
The Department
proposes using a "fact finding" process to resolve
claims but fails to specify appeal and evidentiary procedures
necessary to contest a borrower's claims of misrepresentation. In
addition the Department is given the authority to create groups
of borrowers, advocate on their behalf and ultimately adjudicate
their claims. Such groups which may even include borrowers who
have not filed a borrower defense claim. FIDM believes that a
more clearly defined and equitable resolution process would
better meet basic standards of fairness for borrowers and schools
alike.
The
proposed rule gives the Department the authority to seek
repayment from schools for any loan amounts forgiven. Again, the
procedures for this action are undefined in the proposed rule
except that in the case of a collective claim the Department can
automatically assign liability for repayment to the
school.
III.
Taxpayer Costs
The Department of Education estimates the
potential cost of the proposed regulations may be as much as $43
billion over a ten year period. This staggering amount is the
result of an open-ended approach that assigns virtually all
liability to institutions and which will, in the end, be borne by
tax-payers. These costs do not include potentially limitless
legal costs stemming from litigation, which is actively
encouraged by the proposed rule.
In
sum FIDM believes that the complexity, ambiguity and lack of
fairness of the proposed rule will result in greater, not lesser,
harm to students, schools and taxpayers. Issues of educational
quality, recruitment, graduation and employment, and student loan
defaults would be more effectively addressed by limiting access
to Title IV student aid to those institutions with demonstrated
success in student outcomes.
There
is a critical need in higher education to balance access and
success, cost and quality, opportunity and responsibility. The
proposed rule makes adversaries of those who should be working
together to meet mutual goals of educational success and student
achievement.
Sincerely,
Norine
Fuller
Executive Director; Student Financial Services
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This comment is unrelated
to the information collection required for borrowers seeking to
file a borrower defense claim on this form.
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Samuel Pratt
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ED-2016-ICCD-0075-0014
|
Individual
|
I
recently about 3 months ago applied for permanent/total
disability as reason to remove my student loans through the
servicing agency Fedloans.com. They denied me the request. But
the Federal government itself, labelled me as Disabled when I
applied for a job with homeland security. I sent them a copy of
my Federal Social Security Administration letter which states my
condition. They claim I have insufficient documentation but never
told me what specific documents I should send to them. Very
frustrating.
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This comment is unrelated
to the information collection required for borrowers seeking to
file a borrower defense claim on this form.
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Margaret Reiter
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ED-2016-ICCD-0075-0015
|
Legal Aid Foundation of
Los Angeles/Legal Services Center of Harvard Law School
|
I appreciate the effort
made to provide a universal borrower defense application form. I
write briefly in addition to that comment to point out several
areas where the form does not meet the goals described in the
related Supporting Statement for Paperwork Reduction Act
Submission. For example, the form is not a clear method to
provide necessary information; it does not adequately facilitate
the Department’s receipt of complete information necessary
to process applications efficiently; the Supporting Statement
does not make clear what supporting information the Department
believes it does have, especially concerning borrower defense
claims under the FFEL program – information which it does
not seek from borrowers, but without which the Department might
consider a claim insufficient; while the form purports to be
“universal,” it does not address information that
would support a FFEL claim, but not a Direct Loan claim under the
Department’s proposed Direct Loan borrower defense
regulations; the form will take more than the estimated time
allotted for filling out the form and locating and providing
supporting documents and other supporting evidence; it does not
allow “uniform and directed collection of minimum Borrower
Defense information;” and it does not “ensure”
borrowers wishing to invoke a borrower defense can do so in a
“uniform and efficient manner.”
The
commenter includes seven (7) sections that address the following
concerns:
Clarity,
Ease of Reading, Understanding
The
Form Does Not Adequately Address FFEL Loan Borrowers’
Defenses
The
Form Does Not Assure Applicants that They May Supply Information
or Documents Available to Them, even if They Don’t Have
Everything Requested.
The
Form Does Not Provide an Initial Clear Request to Tell about the
School Experience
The
Form Does Not Address Conduct
The
Form Does Not Seek Corroborating Evidence
The
Form Does Not Address Conduct Used to Prevent Students from
Withdrawing after Enrollment
|
The
Department is aware that it is important to provide plain
language within the form such that borrowers of various
education levels can understand the language therein. For that
reason, we consulted with staff who focus on customer experience
issues to ensure that the form is clear and uses plain language.
The Department also drafted this form such that borrowers must
provide an explanation of the school’s conduct in their
own words. Therefore, each of the relevant sections uses general
questions within certain categories in order to ensure that the
borrowers use their own language and phrasing within their
applications.
The
form does not differentiate between Direct Program and Federal
Family Education (FFEL) Program loans because it will use the
same standards for reviewing claims from borrowers who have
either type of loan, or both types of loans. It will not require
a referral relationship for FFEL borrowers as the commenter
suggests.
The
form, within Section III, specifically states in bold and
underlined text that borrowers only need to fill out sections
within the form that apply to them. It also encourages borrowers
to provide any documents that are related to the application.
While the commenter recommends that the Department provide
examples of the types of documents that may be useful does not
want to dissuade borrowers from applying simply because they do
not have all of the documents the Department may have deemed
useful.
The
commenter suggests that the form should ask borrowers to provide
a clear request for information. The Department believes that
Section III provides a clear request for information, including
asking borrowers details about what activity their school
engaged in, as well as plain language descriptions of the types
of activities that could give rise to a borrower defense to
repayment claim.
The
commenter states that the form does not ask the borrower to
address the school’s conduct. The Department believes that
Section III provides a clear request for the borrower to provide
descriptions of the school’s conduct, including the type
of conduct, which school employees engaged in such conduct, and
the titles of those individual employees.
The
commenter states that the Department does not seek corroborating
evidence. The Department believes that Section III provides a
clear request for the students to include documents related to
the application. Documentation is among the most helpful
sources of information that the Department can use in reviewing
borrowers’ applications.
The commenter
states that the form does not elicit information from enrolled
students, only prospective students. The sections within the
form that ask students about the types of conduct that the
school engaged in do not distinguish between prospective and
enrolled students. Therefore, it does not indicate to borrowers
that borrower defense to repayment applications only relate to
activities that schools engage in prior to a borrower’s
enrollment.
|
The Debt Collective
|
ED-2016-ICCD-0075-0016
|
The Debt Collective
|
The
most obvious problem with this form is that it reflects the
Department’s proposed narrowing of the legal standard for
borrower defense. Along with multiple other commenters, we have
already stated our objections to this narrowing. We incorporate
them here by reference. The form should be broadened to reflect
the broader legal standard that should properly govern borrower
defenses.
We
would also like to object to the language of “forgiveness”
of loans. Borrowers who have been defrauded are not being
forgiven, nor are their loans. They did nothing wrong. They are
having their loans cancelled, erased, discharged, etc., because
it is their right. Because others did them wrong.
The
form requires borrowers to affirm, for each type of
misrepresentation, that the particular misrepresentation played
a role in their decision to enroll in the school. This
affirmation is legally unnecessary and potentially confusing.
The former point has been elaborated on at length in the
negotiated rulemaking sessions (including separate conferrals
with Department lawyers and borrower advocates) and in multiple
comment letters. We incorporate those arguments by reference. As
for the latter, what does it mean to “choose to enroll in
[a] school base in part on the issues” borrowers
described? One might guess that the Department is trying to get
at the fact that a borrower believed the misrepresentations and
those misrepresentations played a role in their decision to
enroll. But this is mostly clear to us because we know the
context of the disputed legal issue of reliance. At least as
currently worded, it is not clear what it would mean to enroll
because of an “issue” they described. If the
Department is to insist on a reliance requirement for individual
borrower applications, then at least it should employ some
different wording. Perhaps something like: “Did the
misrepresentations you discussed concerning [insert topic here]
play a role in your decision to enroll (or stay enrolled) in
your school?”
Additionally,
the form should not require borrowers to articulate everything
that happened to them as a misrepresentation. Borrowers may have
some information relevant to determining whether they were faced
with a misrepresentation when combined with information in the
Department’s possession (or that the Department receives
from elsewhere or through investigation) even if they do not
know it.
It
remains ridiculous that these standards do not apply to FFEL
loans. We incorporate by reference our previous statements on
the topic in addition to those made by the legal aid community.
This form does not even seem to comport with the Department’s
own NPRM. It says that “if you select forbearance and you
have commercially held Federal Family Education Loans (FFEL)
loans, the Department will request forbearance on your behalf.”
Yet the NPRM contains proposed section 682.211 that “would
require a lender to grant a mandatory administrative forbearance
to a borrower upon being notified by the Secretary that the
borrower has submitted an application for a borrower defense
discharge related to a FFEL Loan…” (italics added).
Which is it?
The proposed form
is only available as a fillable PDF. This presents a significant
accessibility barrier to many. First of all, it may require
having Adobe Acrobat installed (the original attestation form
did). Most people have not installed Acrobat, and we received
multiple questions about why the attestation form was not
showing up for borrowers trying to fill it out. As well, in its
current shape, this form will likely have significantly lower
adoption due to its inaccessibility on mobile devices. It would
not be hard to create a mobile-friendly web form that would
guide borrowers through filling this form.
|
This
comment addresses issues related to the legal standard for
borrower defense, not the information collection required by the
form.
The
term “forgiveness” of federal student loan debt is a
plain language description of a borrower’s rights under
the borrower defense to repayment statute and regulations that
is meant to provide clear information for borrowers who may wish
to file an application. The description of the borrower’s
rights is meant to provide a brief, clear description, such that
borrowers understand the process.
Under
the proposed borrower defense to repayment regulations, the
Department may consider the borrower’s actual reasonable
reliance on an alleged misrepresentation by the school in
reviewing a borrower’s application. Therefore, this
section has been edited to reflect that borrowers must affirm
that the issues that they have described in each subsection
within Section III affected their decision to enroll in the
relevant school. The Department largely accepted this
commenter’s edit, which is reflected within the current
version of the application.
The
borrower defense form does not foreclose the Department from
using extrinsic evidence that it has in reviewing a borrower’s
application. The purpose of the form is to elicit relevant
information from a borrower who files an application.
The
Department will request forbearance on behalf of borrowers who
have commercially
held Federal Family Education Loans (FFEL) Program loans because
the lenders that hold those loans must confirm that a borrower
has filed a borrower defense application before places those
into forbearance. Therefore, the mandatory forbearance
regulation will apply to FFEL Program lenders, but the
Department will make the request on behalf of borrowers, such
the lenders can confirm that the relevant borrower has submitted
an application.
The borrower
defense form will be provided in three formats on the
Studentaid.gov/borrower-defense
website: HTML, fillable PDF and a form wizard that can be
submitted online. Borrowers will be able to sign the form wizard
by uploading a file that contains their signature. The form
wizard will be accessible on mobile devices.
|
Dan Connolly
|
ED-2016-ICCD-0075-0017
|
Ideas42
|
One
common barrier to the completion of forms is length. The current
paper version of the Borrower Defense form appears lengthier
than it is, because it is unlikely that any given borrower will
have complaints from each of the categories in Section 3
(“Employment Prospects”, “Program Cost and
Nature of Loans”, “Transferability of Credits”,
“Career Services”, “Educational Services”,
“Admissions & the Urgency to Enroll”, “Other”).
We recommend that the paper version provide a “roadmap”
at the beginning of the document, outlining each section and
providing an estimate of how long it will take. We also
recommend that the online version ask borrowers to indicate
which of the categories their appeal concerns, and use skip
logic to bypass unneeded sections. Providing process
transparency will allow borrowers to complete the form more
effectively, and will increase the number of borrowers who
actually do complete it.
For
several reasons, the choice of whether to request the placement
of one’s loans in forbearance during the adjudication
period is likely to be a difficult one for borrowers. The choice
itself is non-distinct from the rest of the text, and borrowers
may miss the fact that they even have to make a choice.
Borrowers who fail to choose will have their loans placed in
forbearance, potentially accumulating unintended interest. The
decision has many facets, and borrowers may not be able to
accurately weigh the implications of choosing “yes”
or “no if they don’t intuitively understand the
consequences of the choice. Finally, the choice comes at the end
of the form, making it more likely that borrowers will pick an
option just to complete the form rather than fully considering
the choice. We recommend that the Department redesign the choice
on this page so that the “Yes” and “No”
options are clearly marked and placed side-by-side. We also
recommend that the consequences of each option be placed
directly below the choices, rather than in the preceding text.
Finally, the Department should consider moving the choice
earlier in the form, so that borrowers are more likely to
thoughtfully complete it.
Even for the
motivated researchers looking to provide comments on the
Borrower Defense process, it was not necessarily easy to find
its location on the Department’s web site. We expect this
will be even truer for student borrowers who maybe victims of
negligent or malicious practices by schools but are not aware of
the Borrower Defense process. We recommend that the Department
invest resources into actively advertising this option,
particularly targeting borrowers whose schools have had findings
issued by the Department.
|
The
borrower defense form will be provided in three formats on the
Studentaid.gov/borrower-defense
website: HTML, fillable PDF and a form wizard that can be
submitted online. The borrower defense form wizard will allow
for borrowers to skip sections within the form that do not apply
to them.
The
Department agrees that a borrower’s decision with regard
to placing Federal Student Aid loans into forbearance is a
difficult one. Therefore, we have provided a Question and Answer
section prior to requesting that borrowers make the decision to
place or not place their loans into forbearance so that they can
make an informed decision. The Department understands that there
may be borrowers who submit applications for borrower defense
that omit to fill out the Forbearance/ Stopped Collections
section. Therefore, for borrowers who fail to fill out that
section, we will automatically place all Federal Student Aid
loans for those borrowers into forbearance or stopped
collections. If borrowers later decide to remove any Federal
Student Aid loans from forbearance or stopped collections, they
can do so by contacting their servicer(s). With regard to the
commenter’s suggestion that the Department provide the
forbearance option in a side-by-side format, the Department
accepts that edit, which is reflected within the current version
of the application.
This comment is
unrelated to the information collection required for borrowers
seeking to file a borrower defense claim on this form.
|
Sixteen (16) State
Attorneys General
|
ED-2016-ICCD-0075-0018
|
Sixteen (16) State
Attorneys General
|
Replace
the phrase “some or all of your federal student loan debt.
. .” with “all of your federal student loan debt
made to attend the school or program where misconduct occurred”
Replace
the phrase “may include reimbursement for amounts paid”
with “will include reimbursement for amounts paid, if
any”.
The
preamble should also make clear that private loans are not
eligible for relief. The Department cannot discharge private
loans, but students are not always aware of this distinction.
Similarly, it is our understanding that parents seeking
discharge of Parent Plus loans must fill out a separate
application, and this should also be clarified.
We
believe that the Department should consider renaming Section II
to avoid consumer confusion. “School Information” is
a plain language alternative to “Program Information”
that captures the essence of the request.
Many
students cannot distinguish between the options under the
“Credential/Degree Sought”. We recommend providing
additional instruction about what each choice means, and
specifically explaining the difference between a certificate and
a diploma.
We
believe that the Department should strive for simplicity when
explaining “claims for loan relief”. “Tuition
recovery programs” are not common and do not clearly
illustrate what a “claim for loan relief” is. The
Department should consider using a lawsuit or arbitration filed
against the school as an alternative example.
We
generally support the Department’s decision to break out
several types of common misrepresentations that prospective
students encounter in their dealings with predatory schools. It
needs to be made clear, however, that the subsections of Section
III, such as “Employment Prospects” and “Program
Cost and Nature of Loans” are not an exclusive list of the
bases for borrower defense. Taking all these points into
consideration, we propose the following language for the “Other”
section:
Do
you have any other reasons relating to your school that you
believe qualify you for borrower defense? For example, are there
other reasons you feel your school misled you? Is there other
important information the school failed to tell you? Did your
school fail to perform its obligations under its contract with
you? Is there a judgment against your school? Has a state or
federal enforcement agency, such as your state attorney general,
opened an investigation into or made findings against your
school?
Our
understanding is that the Department plans to continue to use
the Form after the new borrower defense regulations are in
effect. We suggest the following:
Did
the school pressure you to enroll immediately, discourage you
from waiting to enroll, discourage you from speaking with a
family member or advisor, portray an admissions recruiter as an
educational counselor or career consultant there to advise you in
your best interest, or otherwise engage in high-pressure or
misleading sales tactics during the admission process?
The
Form should inquire about misrepresentations concerning
licensure and accreditation. We believe the “Employment
Prospects” section should read:
Do
you feel like your school misled you (or failed to tell you
important information) about future employment, the likelihood of
finding a job, how many people graduate, the ability to obtain a
license or certification, eligibility requirements for specific
careers, and/or what the average graduate might make?
The
Department should consider reworking the final question of each
subsection in Section III. Instead of “[d]id you choose to
enroll in your school based in part on the issues you describe
above,” consider “[d]id any of the issues above
affect your decision to enroll in this school?” This
broader phrasing addresses the complex nature of the decision to
attend a given school, while still providing information on
reliance.
We
believe that the following plain language edits would also
benefit the subsection descriptions in Section III:
• In
“Transferability of Credits”, instead of the phrase
“about the transferability of credits”, consider
“about the likelihood your credits from this school might
transfer to other schools”.
• In
“Career Services”, instead of the phrase “about
the availability of job or career services assistance”,
consider “about the availability of help finding a job”.
• In
“Educational Services”, instead of the phrase “the
method of instruction”, consider “instruction
methods”.
We
are concerned that schools may attempt to use the sentence
regarding assignment of claims in the “Certification”
section to preclude a student’s private lawsuit or other
claim for losses unrelated to forgiven Title IV loans. If the
assignment is deemed necessary, the language should make it
clear that only claims relating to forgiven federal student
loans are being assigned. We recommend the following:
I
understand that if my application is granted and my loans are
forgiven, I am assigning to the Department of Education any legal
claim I have against the school for those forgiven loans. I am
not assigning any claims I may have against the school for any
other form of relief—including injunctive relief or damages
related to private loans, tuition paid out-of-pocket, unforgiven
loans, or other losses.
|
The
Department uses the phrase “some or all of your federal
student loan debt. . .” to cover both those situations
where full relief is warranted and those where partial relief is
appropriate. Also, the phrase recognizes that applications may
be filed that relate to some subset of federal student loan debt
and not the full amount.
Again,
the Department has used the language “may include
reimbursement for amounts paid” to reflect both scenarios
where reimbursements are warranted and where they are not.
The
Department understands the commenters’ concerns. With
regard to private, non-Federal Student Aid loans, the Department
plans to update its borrower defense to repayment website to
reflect changes that will go into effect under its forthcoming
final regulations, and will take this comment under advisement
in doing so. With regard to parent borrowers who have Parent
PLUS loans who wish to file borrower defense applications, we
have edited the application to include a section that prompts
these borrowers to include the last four (4) digits of their
child’s Social Security in order to clarify that they must
submit a separate application in order to seek a discharge of
their loans. The Department believes that this section clearly
delineates between a student and parent borrowers.
The
Department has accepted this edit, such that the application
current requests “School Information.”
The
Department understands, based on its review of a significant
number of borrower defense applications, that there are
borrowers who may not understand the distinction between
different programs’ credential levels. However, this
information is important and helpful for the Department’s
review of borrower defense applications. Therefore, this
information, within the current version of the application, is
not mandatory for borrowers’ applications to be considered
complete.
The
Department has accepted this edit, such that this question now
uses a more plain language approach.
The
Department largely accepted this commenter’s edit, which
is reflected within the current version of the application. The
“Other” subsection prompts borrowers with regard to
any other reasons (in addition those specified within the
subsections within Section III above) that their schools may
have mislead them.
The
Department drafted the “Admissions & The Urgency to
Enroll” subsection within Section III of the borrower
defense form such that borrowers must provide an explanation of
the school’s conduct in their own language. We believe
that this section properly identifies high pressure sales
tactics that school personnel may engage in.
The
Department has edited the “Employment Prospect”
section within Section III of the borrower defense form to
include a broader question regarding this type of
misrepresentation.
The
Department has accepted this edit.
The
Department has accepted these edits.
The Department has
accepted this edit.
|
American Federation of
Teachers (AFL-CIO);
Americans
for Financial Reform; Empire Justice Center;
Higher
Ed, Not Debt;
Housing
and Economic Rights Advocates;
Legal
Aid Foundation of Los Angeles;
Legal
Services – NYC;
National
Consumer Law Center, on behalf of its low-income clients;
Project
on Predatory Student Lending, Legal Services Center of Harvard
Law School;
The
Institute for College Access and Success;
U.S.
Public Interest Research Group;
Veterans Education
Success
|
ED-2016-ICCD-0075-0019
|
American Federation of
Teachers (AFL-CIO);
Americans
for Financial Reform; Empire Justice Center;
Higher
Ed, Not Debt;
Housing
and Economic Rights Advocates;
Legal
Aid Foundation of Los Angeles;
Legal
Services – NYC;
National
Consumer Law Center, on behalf of its low-income clients;
Project
on Predatory Student Lending, Legal Services Center of Harvard
Law School;
The
Institute for College Access and Success;
U.S.
Public Interest Research Group;
Veterans Education
Success
|
The
Department should promote the application form through websites
and platforms where borrowers already access information about
student loans.
To
make this discharge application accessible, the Department
should make sure that it sends consistent messages in its
communications about the scope of borrower defense relief. The
Department’s written materials and the materials used by
federal student loan servicers, collectors, and guarantee
agencies should promote the form, note the availability of
borrower defense and other discharges and avoid inadvertently
suggesting that defrauded borrowers are without relief options.
The
Department should make the form available in paper, online, and
optimized for mobile use. The text of the form should identify
where borrowers can go to access the form through their
preferred platform.
The
Department should also provide clear guidance to and ensure that
servicers: (1) inform all borrowers who allege they were harmed
by their school, either orally or in writing, with the
applicable loan relief forms, including discharge applications
and borrower defense forms; and (2) send the borrower defense
form as an attachment to monthly student loan statements for all
borrowers who attended schools that the Department believes
engaged in state or federal law violations.
The
Department should ensure that all federal student loan servicers
and debt collectors proactively direct all potentially eligible
borrowers to the application form in the borrower’s
preferred platform.
The
Department should avoid language that requires applicants to
interpret complex legal concepts. For example, in Section III,
one category of misrepresentation is “program cost and
nature of the loan.” The “nature of the loan”
prompt is vague and does not include plain language examples
such as the common misrepresentation that a school program.
Electronic
versions of the form should use skip-logic to expedite sections
of the form that are not necessary for every borrower. For paper
versions of the form, however, the Department should take care
that skip-logic does not render the form confusing.
The form currently
presents an unnecessarily restrictive view of the reliance
standard: it lists six discrete types misrepresentations,
presents a problematic “other” category, and asks
borrowers if they chose to enroll in a school based in part on
misrepresentations regarding each of these subsections. The form
should include an instruction that borrowers can provide
information about multiple types of misrepresentations,
including misrepresentations about issues not expressly itemized
in the form.
|
This
comment is unrelated to the information collection required for
borrowers seeking to file a borrower defense claim on this form.
However, the Department will endeavor to ensure as many students
as possible are aware of the form when it is finalized.
This
comment is unrelated to the information collection required for
borrowers seeking to file a borrower defense claim on this form.
The
borrower defense form will be provided in three formats on the
borrower defense (Studentaid.gov/borrower-defense)
website: HTML, fillable PDF and a form wizard that can be
submitted online. The form wizard will be accessible on mobile
devices. The borrower defense website will include links to each
of the formats.
This
comment is unrelated to the information collection required for
borrowers seeking to file a borrower defense claim on this form.
However, the Department has taken these suggestions under
advisement for outreach.
This
comment is unrelated to the information collection required for
borrowers seeking to file a borrower defense claim on this form.
The
Department has accepted this edit.
The
form wizard will allow borrowers to skip through sections that
do not apply to them.
Within the
introductory language to Section III, the Department included
language, in boldfaced and underlined text, that states that
borrowers are only required to complete sections that apply to
them. The Department believes that this instruction makes clear
that borrowers can provide information regarding multiple types
of misrepresentations.
|
Suzanne Martindale
|
ED-2016-ICCD-0075-0020
|
Consumers Union
|
As
a general matter, we have concerns that the proposed form uses
language that may be confusing or overly technical for many
people, which may result in the Department receiving less than
the full information borrowers may be able to convey to help the
Department evaluate a claim – or even worse, deter some
borrowers from even attempting to fill out the application. An
overly complex form could undercut the benefits of creating a
standard application process meant to facilitate borrower relief
based on valid claims of school misconduct.
The form makes
specific references to conduct involving lying or misleading
representation, as well as judgments and breaches of contract,
but does not effectively solicit other information from the
borrower that could form a valid basis for a borrower defense
claim. The form appears only to contemplate the new federal
standard for borrower defense, for loans disbursed in 2017 or
later, which the Department is still in the processing of
finalizing. However, significant numbers of borrowers still have
borrower defense claims based on the current standard, involving
any cause of action based on applicable state law. Again, the
Department must use language that solicits meaningful responses
from borrowers, instead of potentially deterring them from
sharing their full stories. The form will be more successful in
eliciting helpful information if it asks borrowers simply to
explain, in their own words, whether they think their school did
things that were wrong or unfair to them and, if so, what the
school did.
|
The
Department has accepted this edit, such that a number of the
subsections within Section III now use a more plain language
approach.
The
Department drafted the borrower defense form for the purpose of
providing borrowers with general sections that encompass the
types of school misconduct that the Department has found in its
review of a large number of borrower defense applications to
date. The form is supposed to both prompt borrowers to provide
relevant information, but also afford them the opportunity to
explain what happened to them in their own language.
|
Harold Huggins
|
ED-2016-ICCD-0075-0022
|
The Council for Education
|
The
CED proposals an amendment to the form for the Borrower Defense
claim to include the right to representation by a third party
advocacy organization to act in the interest of the borrower as
a protective class.
The CED proposals
an amendment to the form for the Borrower Defense claim to
include contact information to the advocator.
|
This
comment is unrelated to the information collection required for
borrowers seeking to file a borrower defense claim on this form.
This comment is
unrelated to the information collection required for borrowers
seeking to file a borrower defense claim on this form.
|
Vicki Shipley
|
ED-2016-ICCD-0075-0023
|
Association/Organization
|
On behalf of the FFEL
community, thank you for the opportunity to provide the attached
comments to the draft Application for Borrower Defense to Loan
Repayment form. Our comments are intended to provide clarity,
consistency and transparency as well as some general questions
and comments. It is our understanding this form is for the
current process and we look forward to the opportunity to review
the form for necessary updates once the final regulations are
published.
The commenter provided
a marked up version of the borrower defense form with two edits
to Section IV, “Forbearance/Stopped Collections.”
|
The Department accepted
these two edits.
|