Education Secretary Betsy DeVos Withdraws Obama-Era Student Loan Protections
Education Secretary Betsy DeVosBloomberg/Getty Images
This article originally appeared on Fortune.
President Trump’s Education Secretary Betsy DeVos undercut student loan protections on Tuesday that were put in place by the administration of former President Barack Obama.
The Obama policy memorandums withdrawn by DeVos required that the government’s Federal Student Aid office do more to help borrowers manage or discharge their debt, Bloomberg reports.
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DeVos said in a press memo that she was rescinding the previous administration’s list of demands to “demonstrate sound fiscal stewardship of public dollar” and limit the cost to taxpayers. The move came after a letter from industry lobbying National Council of Higher Education Resources asking Congress to alter or delay the Education Department’s changes.
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Then-President Obama issued the guidance after a wave of student loan defaults and allegations that lenders were providing false information, charging unexpected fees and cheating borrowers out of repayment rights.
The guidelines also aimed to reduce awarding contracts to firms who mistreated or misled borrowers. The current contracts are set to expire in 2019.