Federal Student Loan Debt Erased for 450,000 Borrowers

Why it matters locally: While the exact number of North Carolina borrowers affected by this specific class-action lawsuit resolution is not immediately available, a portion of the 450,000 individuals nationwide whose federal student loan debt will be erased are likely residents of the state.

WASHINGTON – Federal student loan debt for approximately 450,000 borrowers will be erased, resolving a long-standing class-action lawsuit. These borrowers contended their colleges engaged in fraudulent practices. The court action impacts an estimated $6 billion in federal student loan debt, according to recent figures. The class-action lawsuit has proceeded through federal courts for several years, spanning multiple presidential administrations. Originally filed as *Sweet v. DeVos* in 2019, the case later became *Sweet v. Cardona* during the Biden administration. It is currently known as *Sweet v. McMahon*, referencing the current Secretary of Education. This resolution addresses claims brought by borrowers who stated their educational institutions defrauded them, leading to significant federal student loan obligations.