As Richard Cordray exits his work along with the process of launching the federal student aid system which had encountered issues, such as systems not being able to work properly as well as the cases where students were not able to submit applications, the complexities continue to hinder some individuals’ pursuit for education.
The head of the Biden administration’s federal student aid office is resigning, the Education Department confirmed Friday – a move that occurs amid administrative mayhem related to the Federal Student Aid application process that has either been locked or a glitch has prevented much more than half a million applicants from filling the form.
From 2021 through present day, Richard Cordray has held the teaching of the Department’s Office of Federal Student Aid. Driven by the administration’s reform initiatives of designing innovative, yet workable approaches, to ameliorate the repayment of student loans and delivering a massive debt cancellation to the student loan borrowers; the aspiration to change the administration of the Federal student loan repayment is still very
“We are grateful for Rich Cordray’s three years of service, in which he accomplished more transformational changes to the student aid system than any of his predecessors,” Education Secretary Miguel Cardona said in a statement that did not mention the federal aid application snafu.
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Instead, Cardona focused on what he called a “consequential tenure” that included overseeing major structural changes to federal student loan repayment plans, which resulted in billions of dollars in debt relief for millions of borrowers, as well as the design and implementation of a new, income-driven repayment system.
“It’s no exaggeration to say that Rich helped change millions of lives for the better,” Cardona said.
As it stands, the Biden administration has canceled $144 billion for 4 million loan borrowers. Its newest cancellation plan would wipe out billions more for as many as 30 million borrowers, including 23 million who will have all of their interest canceled if their balance is more than it was when they started paying back their loans.
Yet for all the department’s efforts on loan cancellation, it’s now facing a crisis that stands to undercut those successes. Every year more than 17 million students fill out a Free Application for Federal Student Aid, the gateway to securing federal loans to enroll in college.
During the past many years, the wrinkle has been called a bipartisan boxing bag that how cumbersome it is to you get it done. The brainchild of the executive branch was a redesign program that was meant to cut the application process into the shortest possible and to allow it pass just 30 out of over 100 original questions. However, the processing was too late, not an exception with technical errors, and in most cases did not allow students to submit their applications or sometimes just completely refused them without an explanation. The system too sought intricate calculations of the student aid index, which were prone to errors, and it depended on inaccurate tax data from the IRS.
To add on that, US-born students whose parents are the country illegally and does not possess a Social Security number have found it hard to fill the form and until March the parent’s section of the form did not allow their parents whatsoever. Parents who do not have legal citizenship in the country are in another kind of problem where there is no communication from the IRS regarding the tax data, so they are bound to manually enter the information.
Combined, the issues have caused FAFSA completion rates to plunge: Roughly one third of the 2024 High School class have not done the FAFSA form yet which is a 29% drop in comparison to the number of students last year who have completed the form, by this time, according to the National College Attainment Network (NCAN).
The network estimates as many as 700,000 fewer high school seniors might submit a FAFSA compared to last year, which would translate to a 4% drop in college enrollment – the biggest drop since the COVID-19 pandemic. And it’s an issue that’s impacting low-income families and first generation students.
Cordray, the former head of the Consumer Financial Protection Bureau, will continue on at the federal aid office in his role as Chief Operating Officer until June in order to see through to completion “key priorities” – likely the resolution of the FAFSA debacle.
