Student loan forgiveness: Administration cancels debt for some University of Phoenix students

The Biden administration announced Wednesday that it is canceling nearly $37 million of federal student loan debt for more than 1,200 borrowers who attended the University of Phoenix.

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The administration said the debts will be canceled because it found that the for-profit school misled students about job prospects.

To be eligible for the debt cancellation, former University of Phoenix students must have been enrolled at the school between Sept. 21, 2012, and Dec. 31, 2014, and have already applied for loan forgiveness under a program called borrower defense to repayment.

The announcement of the debt forgiveness comes weeks after a federal district court dismissed a lawsuit from two conservative groups that would have blocked the Biden administration’s plan to offer student loan forgiveness to more than 800,000 borrowers.

That plan would erase outstanding debt worth about $39 billion that certain borrowers still owe after making 20 to 25 years’ worth of student loan payments.

In August, the administration also launched an income-driven repayment plan called SAVE (Saving on a Valuable Education) that will reduce monthly payments for eligible student loan borrowers.

The U.S. Supreme Court in June rejected Biden’s student loan forgiveness program, which would have canceled as much as $20,000 in student loan debt for individual borrowers, totaling $430 billion.