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We Applaud Debt Forgiveness for Disabled Veterans and Urge Closure of the 90/10 Loophole

President Donald J. Trump on Wednesday signed a presidential memorandum to eliminate the student loan debt of fully disabled veterans; according to the Administration, the action forgives an average of $30,000 in debt owed by more than 25,000 eligible veterans. Though fully disabled veterans are already qualified to have their student loan debt forgiven, only approximately half of 50,000 eligible veterans have received their benefits due to a complex and bureaucratic application process. 

In a statement, Iraq and Afghanistan Veterans of America (IAVA) CEO Jeremy Butler said: 

“The President’s directive will provide welcome and much-needed relief to thousands of wounded warriors struggling to make ends meet under mountains of growing student loan debt. This executive action is a critical step in the right direction to ensure that veterans who have sacrificed so much in service to this country have the tools to transition back to civilian life with meaningful education and career opportunities – without carrying a crushing, insurmountable financial burden. We urge Congress to take the next step to protect veterans seeking higher education: close the 90/10 loophole that allows unscrupulous educational institutions to exploit and defraud veterans and their families out of their hard-earned education benefits.  Veterans who have served bravely should be empowered to access a quality higher education and fulfilling career; it’s time our government removes any obstacles in their path to independence and success.”  

IAVA supports legislation sponsored by U.S. Senators Johnny Isakson and Jack Reed and U.S. Representatives Conor Lamb and Brian Fitzpatrick to automatically waive student loan debt for fully disabled veterans. 

Many veterans are being taken advantage of by a loophole in federal law known as the 90/10 rule, which allows schools to deceptively recruit veterans, service members, and their families to enroll in poor educational programs at exorbitant costs. Congress passed the 90/10 rule in 1998 as part of the Higher Education Act, which placed a cap on the amount of money institutions could receive from federal funds at 90 percent. But, funds from VA educational benefits,  which include GI Bill dollars & Defense Department Tuition Assistance, do not count as part of this 90 percent – thus creating the loophole.


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