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Gov't report: 99% of student loan forgiveness applicants were denied

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A GAO report Friday said 99 percent of all applicants for student loan forgiveness were rejected. File Photo by ShaunWilkinson/Shutterstock/UPI

By Ed Adamczyk, UPI

Confusion and mismanagement has led to the rejection of 99 percent of all Americans applying for student loan forgiveness, an independent government report said Friday.

The Department of Education's forgiveness program allows new public servants -- like teachers and firefighters -- to work for 10 years, make payments on their student loans over that time and ultimately have the remainder of the loan forgiven by the government.

Less than 300 of about 29,000 applicants, though, have successfully seen their loans forgiven.

An audit report by the Government Accountability Office said "the large number of denied borrowers suggests that many are still confused by the program requirements."

The report also blamed the Education Department for a lack of cooperation with FedLoan, the company hired to administer the program.

The audit said department staff "incorrectly identified what they thought was an error in how the servicer was certifying borrowers ... because they were not aware of the most recent guidance."

The report said nearly all communication between the Education Department and FedLoan was done by email, and created a "fragmented collection of guidance and instructions."

About one-third of the rejected applicants were denied because of missing information. The majority of the rest were denied for not meeting program requirements.

The program began in 2007, meaning the very first applicants have already completed the initial 10-year term for forgiveness.

The GAO report recommended that payment information should be standardized by the Education Department -- not FedLoan -- and that additional information should be provided to applicants.

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U.S. - U.S. Daily News: Gov't report: 99% of student loan forgiveness applicants were denied
Gov't report: 99% of student loan forgiveness applicants were denied
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