On the morning of Monday, Aug. 27, Seth Frotman told his two young daughters that he would likely be home early that day and could take them to the playground. They cheered.
He did not tell them why their dad, who often worked long hours as the student loan watchdog at the federal Consumer Financial Protection Bureau, would be free for an afternoon play date.
Frotman assumed that after walking into his office and, at precisely 9:30 a.m., hitting “send” on an incendiary resignation letter to lawmakers accusing the Trump administration of betraying student borrowers, he would promptly be walked out with his things, and his career, in a cardboard box.
More than 550,000 people have signed up for a federal program that promises to repay their remaining student loans after they work 10 years in a public service job.
But now, some of those workers are left to wonder if the government will hold up its end of the bargain — or leave them stuck with thousands of dollars in debt that they thought would be eliminated.
In a legal filing submitted last week, the Education Department suggested that borrowers could not rely on the program’s administrator to say accurately whether they qualify for debt forgiveness. The thousands of approval letters that have been sent by the administrator, FedLoan Servicing, are not binding and can be rescinded at any time, the agency said.
More students than ever before are relying on student loans to pay for their college education. 71 percent of students earning a bachelor’s degree graduate with debt, averaging $29,400. While most students are able to repay their loans, many feel burdened by debt, especially as they seek to start a family, buy a home, launch a business, or save for retirement.
That’s why, as part of his year of action to expand opportunity for all Americans, President Obama is taking steps to make students loan debt more affordable and manageable to repay.