CA Attorney General seeks to reinstate student loan forgiveness program

SAN FRANCISCO (KGO) -- California Attorney General Xavier Becerra seeks to force the Trump administration to reinstate a loan forgiveness program passed under President Obama.

In the last few years, several for profit schools including Heald, Everest and ITT Tech have been under federal investigation and eventually closed. Federal loans taken out by students to attend those schools were eligible to be forgiven under a program by the Obama administration. All that changed this summer under President Donald Trump.

RELATED: 7 On Your Side: What happens to ITT Tech students after closures
Marcus Molina just learned about the change on Thursday. He still has a stack of text books from his days at ITT Tech in Oakland. He attended there with dreams of pursuing a career in computer security.

The former high school drop-out who eventually obtained his GED admitted that, academically, he was over his head. "I only obtained my GED. This is like way far advanced," Molina told 7 On Your Side.

Marcus dropped out of ITT after a little more than a semester because he couldn't keep up. Today, he still owes $8,000 for his federal student loan.

"We were kind of baited in by the administration that the curriculum was easy," he said.

RELATED: Students express outrage over ITT Tech closures

ITT was investigated by the federal Department of Education for fraud and the school eventually filed for bankruptcy.

Suzanne Martindale is with Consumers Union in San Francisco. "All too often, students found after they enrolled that the education really wasn't what they promised," she said.
Federal loans to attend for profit colleges were eligible to be forgiven under the Obama Administration, but Secretary of Education Betsy Devos put a halt to the forgiveness program even before it could be implemented.

California Attorney General Xavier Becerra is suing along with 17 other state Attorney Generals to get the program reinstated.

"This is really was a situation where students were taken advantage," said Martindale.

The Department of Education sees it differently. A spokeswoman told us "with this ideologically driven suit, the state Attorneys General are saying to regulate first, and ask legal questions later."

President Trump's own Trump University was investigated by the federal government and eventually shut down after multiple lawsuits.

Marcus is banking on the attorneys general being successful with their lawsuit. "It's good. It gives us a chance. You know some type of hope," he said.

Students who attended for-profit colleges and who need help with their federal student loans can contact the East Bay Communitty Law Center by clicking here and the Housing & Economics Rights Advocates by clicking here.
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