{"id":167961,"date":"2021-02-01T17:27:00","date_gmt":"2021-02-01T14:27:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/students-and-former-students-face-a-15-billion-debt-crisis-potentially-holding-them-back-from-graduating\/"},"modified":"2021-02-01T17:27:00","modified_gmt":"2021-02-01T14:27:00","slug":"students-and-former-students-face-a-15-billion-debt-crisis-potentially-holding-them-back-from-graduating","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/students-and-former-students-face-a-15-billion-debt-crisis-potentially-holding-them-back-from-graduating\/","title":{"rendered":"#: Students and former students face a $15-billion debt crisis \u2014 potentially holding them back from graduating"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3d8267082a0\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3d8267082a0\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/students-and-former-students-face-a-15-billion-debt-crisis-potentially-holding-them-back-from-graduating\/#%E2%80%98We_are_under-appreciating_the_true_scope_of_the_student-debt_crisis_said_Seth_Frotman_executive_director_of_the_Student_Borrower_Protection_Center\" >\u2018We are under-appreciating the true scope of the student-debt crisis,\u2019 said Seth Frotman, executive director of the Student Borrower Protection Center<\/a><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><ul class='ez-toc-list-level-6' ><li class='ez-toc-heading-level-6'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/students-and-former-students-face-a-15-billion-debt-crisis-potentially-holding-them-back-from-graduating\/#Congress_looks_into_helping_former_students\" >Congress looks into helping former students<\/a><\/li><\/ul><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/students-and-former-students-face-a-15-billion-debt-crisis-potentially-holding-them-back-from-graduating\/#Jillian_Berman\" >Jillian Berman<\/a><\/li><\/ul><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong>#: Students and former students face a $15-billion debt crisis \u2014 potentially holding them back from graduating<\/strong>&#8221;<\/p>\n<h2 class=\"article__subhead\" itemprop=\"alternativeHeadline\"><span class=\"ez-toc-section\" id=\"%E2%80%98We_are_under-appreciating_the_true_scope_of_the_student-debt_crisis_said_Seth_Frotman_executive_director_of_the_Student_Borrower_Protection_Center\"><\/span>\n  \u2018We are under-appreciating the true scope of the student-debt crisis,\u2019 said Seth Frotman, executive director of the Student Borrower Protection Center<br \/>\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><\/p>\n<div class=\"column column--full article__content\">\n<div id=\"js-article__body\" class=\"article__body article-wrap at16-col16 barrons-article-wrap\" itemprop=\"articleBody\" data-sbid=\"WP-MKTW-0000150112\">\n<div class=\"barrons-article-ad-wrapper\">\n<div data-track=\"barrons-article-ad-wrap\" class=\"barrons-article-ad sticky_item\">\n<div class=\"barrons-main-article-ad-target sticky_target body_ad\" aria-hidden=\"true\"><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<p>       As the COVID-19 pandemic has wreaked financial havoc on colleges, their students and student-loan borrowers, the government has stepped in to provide billions of dollars of relief. But at least one group of students is still being left out.\u00a0<\/p>\n<p> Some federal student loans have been paused for millions of borrowers and Congress has sent colleges billions in funding to help them shore up their coffers and distribute emergency aid to students, but many students remain in the red.<\/p>\n<div class=\"paywall\">\n       It\u2019s likely that the pandemic put more students at risk of owing money to schools they left, said Rebecca Maurer, counsel and program manager at the organization.\u00a0<\/p>\n<p>\u201cIt just caused upheaval,\u201d Maurer said of the pandemic, particularly its early weeks when students may have left school unexpectedly as the country shut down. \u201cAnd what we know is that upheaval especially for low-income folks going to community colleges\u2026that upheaval is likely to result in institutional debt.\u201d\u00a0\u00a0<\/p>\n<p>Sometimes that\u2019s an unpaid library or parking fine. In other cases, a college may hold a student liable for federal financial-aid funds, including grants, if they withdraw at the wrong time.<\/p>\n<p>Now, one advocacy group is calling on lawmakers to include these former students in future pandemic relief.\u00a0<\/p>\n<p>\u201cWe are under-<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>reciating the true scope of the student-debt crisis in terms of the type of loans and type of debt, and the sheer number of people affected,\u201d said Seth Frotman, the executive director of the Student Borrower Protection Center. <\/p>\n<p>Frotman\u2019s organization released a <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/protectborrowers.org\/wp-content\/uploads\/2021\/01\/Withholding_Dreams_SBPC.pdf\" class=\"icon none\">brief Monday<\/a>, urging lawmakers to consider these former students as they think through future relief packages.\u00a0\u00a0<\/p>\n<p>\u201cUntil we truly understand the ways in which the larger issue of student debt is impacting individuals and their families we\u2019re never truly going to solve it,\u201d said Frotman, the former student-loan ombudsman at the Consumer Financial Protection Bureau.\u00a0<\/p>\n<p>These debts, though often small, can be pernicious. In some cases, colleges will use traditional debt-collection tactics to recoup the funds, referring them to collection agencies. <\/p>\n<div id=\"cx-membership-tile\"><\/div>\n<p>In other scenarios, they will withhold students\u2019 transcripts, throwing up a major obstacle for students looking to continue their education and earn a degree that would help them pay off the loan.\u00a0<\/p>\n<p>Roughly 6.6 million students and former students are on the hook for an estimated $15 billion in institutional debt \u2014 or funds they owe to their school, <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/sr.ithaka.org\/publications\/solving-stranded-credits\/\" class=\"icon none\">according to a report<\/a> published last year by Ithaka S+R, a non profit focused on educational research. <\/p>\n<p>\u201cThey can\u2019t get their old credits and so they kind of have to start over,\u201d said Catharine Bond Hill, managing director at Ithaka S+R and one of the authors of the organization\u2019s report released last year. \u201cAny investment they made up until that point is essentially lost.\u201d\u00a0<\/p>\n<p>One of the most insurmountable types of debt owed to schools that students encounter has to do with an obscure federal financial-aid regulation.<\/p>\n<p>The rule, known as Return to Title IV, requires that if a student using federal financial aid drops out before completing 60% of a term, any portion of the aid they haven\u2019t technically \u201cearned\u201d from attending the school must be returned to the federal government. <\/p>\n<p>Often schools will simply return the aid back to the government on behalf of a student, typically because the aid went directly from the government to the school initially.<\/p>\n<p>The school will then hold the student liable for those funds, even if they came from a Pell grant, the money the government provides for free to low-income students to attend college.<\/p>\n<h6><span class=\"ez-toc-section\" id=\"Congress_looks_into_helping_former_students\"><\/span>Congress looks into helping former students<span class=\"ez-toc-section-end\"><\/span><\/h6>\n<p>Despite these tactics, colleges and universities rarely recoup much of the funds. For example, the University of California system estimated that it would lose $10 million to $12 million in annual revenue \u2014 out of a $39 billion budget \u2014 if they couldn\u2019t collect on the debts, according to data cited by SBPC.\u00a0<\/p>\n<p>Now, SBPC is calling on Congress to find ways to include these former students in future relief initiatives. They propose that lawmakers require colleges to wipe out institutional debt as a condition for receiving more relief. <\/p>\n<p>Short of that, they\u2019re calling on the state and federal government to ban transcript withholding \u2014 a step some states have already taken.\u00a0<\/p>\n<p>Finally, at a minimum, they\u2019re asking the federal government to insist that colleges pause collections on institutional debt at least for the same period as the student-loan payment and collections freeze as a condition for receiving any relief.\u00a0<\/p>\n<p>Mark Huelsman, a fellow at SPBC, said that if the student-loan payment pause was premised on the assumption that borrowers shouldn\u2019t have to pay their student loans to stay afloat in the current economy, \u201chaving this debt out there and collecting on this debt is particularly inhumane is counterproductive.\u201d\u00a0<\/p>\n<p>\u201cFederal and state policymakers should be taking a hard look at the ways that these debts are hanging over students\u2019 heads and addressing them, cancelling them,\u201d he said.\u00a0\u00a0<\/p><\/div>\n<\/div><\/div>\n<p><\/p>\n<div class=\"byline article__byline\">\n<p>      <span>By<\/span><\/p>\n<div class=\"author  hasMenu\" data-scrim='{\"type\":\"author\",\"header\":\"Jillian Berman\",\"subhead\":\"The Wall Street Journal\",\"list\":[]}' itemscope itemprop=\"author\" itemtype=\"http:\/\/schema.org\/Person\">\n<h4 itemprop=\"name\"><span class=\"ez-toc-section\" id=\"Jillian_Berman\"><\/span><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/marketwatch.com\/author\/jillian-berman?mod=MW_author_byline\">Jillian Berman<\/a><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/p><\/div>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"http:\/\/www.marketwatch.com\/news\/story.asp?guid=%7B21005575-02D4-D4B5-4572-D24A6067C6D1%7D&#038;siteid=rss&#038;rss=1\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;#: Students and former students face a $15-billion debt crisis \u2014 potentially holding them back from graduating&#8221; \u2018We are under-appreciating the true scope of the student-debt crisis,\u2019 said Seth Frotman, executive director of the Student Borrower Protection Center As the COVID-19 pandemic has wreaked financial havoc on colleges, their students and student-loan borrowers, the government&#8230;<\/p>\n","protected":false},"author":1,"featured_media":167962,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[],"class_list":["post-167961","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/167961","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=167961"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/167961\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/167962"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=167961"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=167961"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=167961"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}