Federal Student Aid Chief Talks Student Debt Relief at NASFAA 2022

By Hugh T. Ferguson, NASFAA Senior Staff Reporter

In kicking off the Tuesday session of the 2022 NASFAA National Conference in Austin, attendees had the chance to hear directly from the head of Federal Student Aid (FSA) Richard Cordray, who provided NASFAA members with details on the latest initiatives related to student aid programs.

Since taking the helm at FSA in May 2021, Cordray has led the office through the transition of millions of student loan borrowers to new servicers, an overhaul of the Public Service Loan Forgiveness (PSLF) program, and the continued reworking of the student loan servicing system.

But at the forefront of many people’s minds is still the possibility of widespread loan forgiveness. While Cordray reiterated previous remarks — such as those on Monday from Under Secretary James Kvaal — that the White House has not yet made a decision on loan cancellation, he said FSA will stand ready to be able to implement whatever decision the administration arrives at.

Aside from unilaterally canceling all student loan debt, the administration has other tools at its disposal to provide relief for borrowers, such as through approving borrower defense claims. Cordray highlighted FSA’s role in beefing up its oversight and protections for borrowers through borrower defense and how recent action has allowed for automatic group discharge for students who don't need to raise their hand for relief. He added that FSA will have more announcements in the near future concerning additional borrower defense claims.

On the PSLF limited waiver, Cordray said he was very worried the waiver will run out before all eligible borrowers take advantage of the benefit. Cordray said he is pushing hard to get approval for the waiver to be extended, but such a move could face hurdles due to limits in executive authority. In the meantime, Cordray urged financial aid offices to keep communicating the benefit and remind borrowers it is slated to expire at the end of October. 

Speaking of timeline, Cordray repeated Kvaal’s reminder that student loans payments are currently expected to resume after August 31.

Cordray said that it is entirely possible that the moratorium may be extended again, though "that is entirely above my pay grade," he said. He pledged that as FSA has more information, they will communicate as fully as they can and continue preparations over the next two months.

In the meantime, Cordray encouraged financial aid administrators to assist borrowers in exploring whether they qualify for other means of relief, like income-driven repayment (IDR) plans. 

Once repayment does resume, Corday said that FSA was working to put borrowers who had previously defaulted into good standing, as announced as part of ED’s "fresh start" plan.

Cordray also walked through the agency’s recent work that seeks to ensure all Americans have access to the financial tools they need to access higher education. 

In the wake of the pandemic, Cordray said the agency has redoubled its efforts to enable the American dream, but for many, still recovering from the economic toll of the past two years, it has been a struggle.

As a part of FSA’s communication strategy, Corday detailed how his team has taken deliberate steps to improve online communication to help students better understand the financial aid process, simplify that process, boost capacity, and fix long-term flaws in education forgiveness programs. Cordray detailed how the launch of FSA Partner connect has proved popular and has boosted capacity to reach out to financial aid professionals.

Cordray also said that feedback from financial aid professionals on Partner Connect is important to FSA and that the agency would like to hear from the field and will be debriefing with agency officials after the conference to learn more. 

On improving data, Cordray also touted the modernized NSLDS Professional Access website, which will be available in about one month, on July 25. The updated website will feature a more user-friendly navigation, a comprehensive overview of financial aid recipients’ history, and more. 

A huge undertaking for FSA is the ongoing work on FAFSA simplification, with technological changes that are continually being rolled out to address the aging data systems, as well as implementing changes to the form.

Corday noted that an important state-driven initiative taking place in both red and blue states is adding FAFSA completion as a high school graduation requirement, and urged attendees to support this change to help improve enrollment trends that have been hindered by the pandemic. 

Concerning the student loan portfolio, Cordray detailed how technological updates have enabled a more streamlined approach to completing loan discharges for eligible borrowers. By using data automation and a data match with the Social Security Administration, Cordray said FSA would be able to more easily administer relief for a host of borrowers, specifically citing those who qualify for a total and permanent disability (TPD) discharge.

Following Cordray’s remarks, officials from the Department of Education (ED) also provided a detailed federal update that touched on the negotiated rulemaking process, the work of congressional appropriators and the Consolidated Appropriations Act, recent Dear Colleague Letters, and key operational updates and reminders. 

Follow along with all that's going on today on Facebook and Twitter using #NASFAA2022 and keep an eye on our 2022 Conference Summaries page for frequent updates throughout the conference.

 

Publication Date: 6/28/2022


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