“It’s $10,000 that’s at stake.” Borrowers who used Pell Grants decades ago find no evidence and fear they will lose Biden’s relief.

By Jillian Berman

MarketWatch found that student borrowers who say they used Pell grants before 1994 cannot find proof of the grant on the government’s student aid portal.

Although she applied to college more than 40 years ago, Frida Marte clearly remembers the details of the experience.

She had come to the United States from the Dominican Republic only seven years previously and was unfamiliar with the college process. “I leaned on the college counselor a lot,” Marte said. Mr. Block, who was also her US history teacher, pushed Marte to apply to a four-year residential college instead of staying home and attending community college.

“He kind of encouraged me and gave me the assurance that it would be paid off,” Marte said recently. “He helped me fill out the financial aid application. I took it to my mom — I was doing the translation — she signed it.”

Marte, 62, decided to attend one of these four-year schools – the State University of New York at Stony Brook. She recalls being in her kitchen on a Saturday afternoon when she received the award letter stating that her tuition and expenses would be covered by New State’s Tuition Assistance Program. York and by funds from the federal government. Marte remembers the name of the federal grant, called the Basic Educational Opportunity Grant, even though since she went to college it has fallen into disuse; it is now known as the Pell Grant.

“I couldn’t have paid for my education, being one of eight children of a single mother, without this Pell scholarship,” she said. Two of his siblings also used TAP and BEOG to pay for their education, Marte added. “We were living on welfare — that’s how we were able to eat and cover our rent.”

But now, when Marte logs into her portal on the Department of Education’s financial aid website, there is no evidence that she used the grant she remembers so clearly. “I’ve been browsing all over the internet and can’t find where I’m supposed to get this information, I don’t know where to go.”

That makes Marte nervous about not getting the $20,000 in student debt relief she thinks she’s entitled to under the Biden administration’s debt cancellation plan. All borrowers who earn less than $125,000 a year can get up to $10,000 in debt forgiveness, but those who used a Pell Grant, the money the federal government provides to low-income students who don’t does not need to be repaid, are eligible for an additional $10,000 in relief.

Marte is not alone. Other student borrowers who think they used a Pell grant decades ago can’t find proof of the grant on their student aid portal, MarketWatch has found, and fear that means they won’t get not complete cancellation of the debt to which they believe they are entitled to receive. MarketWatch spoke with student loan borrowers and advocates suggesting the issue on the Department of Education website affects people who received Pell grants before 1994.

For Marte, there’s a lot at stake. If the government paid off $20,000 of his student debt, that would be a big help, Marte said. That’s why she was initially “thrilled” when she heard about Biden’s plan. Her son also received a Pell scholarship when he attended the University of Albany, part of the State University of New York system where Marte went to undergraduate, but that wasn’t enough. to cover all its costs. She borrowed from the federal government to help fund her education through its Parent PLUS program. Parent PLUS loans offer fewer protections than loans students borrow to fund their own education, which means it can be difficult for borrowing parents to find an affordable way to pay off debt.

It’s especially troubling for Marte, who is soon to retire and will be living in New York’s borough of the Bronx on about $1,000 a month in government benefits.

“It worries me and keeps me awake at night,” Marte said of her student loans. If she’s unable to pay the debt and she defaults, “they could come back and take that money out of my Social Security.”

If Marte did in fact receive a Pell Grant as she remembers, she will receive the $20,000 in relief, according to the Department of Education, which did not immediately provide comment. “You don’t need to take any additional steps to show us that you have received a Pell Grant,” a frequently asked questions page on the agency’s website advises borrowers. In addition, the debt relief application form does not ask borrowers to indicate whether they had a Pell grant, and a senior administration official confirmed to reporters earlier this month that the agency would check whether the applicants had received a Pell grant.

Yet Thomas Gokey, an organizer for The Debt Collective, a debtors’ union that has been advocating for mass debt cancellation for more than 10 years, said it can be difficult for borrowers to be sure the program will work as it is supposed to.

“That old phrase, trust but verify, at this point we have to trust that the Department has the data, that the data is accurate, that it has no errors,” Gokey said.

It is not known exactly how many borrowers are affected by this problem. The White House said that of borrowers eligible for relief under the cancellation plan, more than 60%, or 27 million, used a Pell grant. Nevertheless, it is difficult to say how many of these borrowers cannot see proof of their scholarship on their student aid portal; the problem appears to be isolated for borrowers who used the grant before 1994.

The lack of certainty surrounding the status of relief for borrowers who used Pell grants decades ago is indicative of many obstacles the Biden administration faces as it seeks to successfully implement the plan. unique cancellation and other student loan reform initiatives. These challenges include borrower confusion, borrowers’ lack of confidence that they will get the relief they are entitled to based on bad past experiences, and a program with dozens of stakeholders and iterations where Decades-old decisions may have implications for today. .

The Debt Collective recently started organizing student borrowers over 50, and Gokey said he’s heard from many people who face the issue. Gokey said he went deep with about half a dozen borrowers trying to help them navigate this situation. Like MarketWatch, it was unable to confirm that they actually received the grant; their colleges likely had student records dating back almost 30 years at least, and the borrowers he spoke with kept no records showing they had received a Pell Grant.

Did you use a Pell grant before 1994 and do you have proof? We want to hear from you. Email [email protected]

“There’s no way to verify that, before 1994,” Gokey said. But, he added, “I want to keep things in perspective. The Ministry of Education probably has this data and for most people it is probably accurate, we just know from experience that there is people falling through the cracks.”

Johnson Tyler, a Brooklyn Legal Services attorney working with Marte on its student loans, said he would feel more confident if the Department could offer data on the number of people who used pre-1994 Pell grants and who , according to him, will be eligible for debt relief.

“It’s an enigma,” Tyler said. “How do you solve this problem? It’s $10,000 at stake. You’re looking at a computer spec sheet that doesn’t mention it, so it’s just your word against whoever it is.”

According to David Bergeron, who left the Department for Education in 2013 after working there for more than three decades, the agency does indeed have the information it needs to confirm that borrowers used Pell grants decades ago.

“As far as I know from my time there, they have records going back to the inception of the program on who received Pell grants and in what amounts for each year,” he said. When he was there, the earliest Pell Grant data was stored on magnetic tape, a precursor to the floppy disk, Bergeron said.

He recalls one instance during his tenure when “there was some angst” about whether the agency would be able to access a year’s worth of data. Tapes “get brittle and break, you may have to manually assemble reels of tape to play them,” he said.

Bergeron isn’t sure why the pre-1994 Pell Grant data isn’t appearing for borrowers when they visit the department’s website, but he said he assumes it’s because the current version The Student Loans Data System was built around 1994 and officials did not feel the need to download all of the program’s history records.

Although borrowers can’t see those records on the department’s website, the agency has a system in place to verify that data, Bergeron said. There is a lifetime cap on the amount of Pell Grant funds an individual borrower can use; each time a student completes the Free Application for Federal Student Aid, or FAFSA, the agency searches the records to see if the borrower has reached their limit, he said.

“They built the infrastructure a long time ago,” Bergeron said. “The rules changed over time,” he said of Pell’s eligibility cap, “it was complicated, but the Department figured out how to deal with it.”

Borrowers probably cannot rely on their schools to confirm that they have used a Pell Grant. Colleges are only required to retain student records for three years after the student is no longer enrolled. On the day the Biden administration announced the debt relief package, colleges were ‘inundated’ with calls from former students asking if they had received a Pell scholarship and if the school could provide proof that they had used a Pell grant, said Karen McCarthy, vice president of public policy and federal relations at the National Association of Student Financial Aid Administrators.

“Schools were freaking out a bit too,” she said. “They were getting all these phone calls. The Department clarified within days that it was all in their files and they would double-check it.”

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(MORE TO BE FOLLOWED) Dow Jones Newswires

10-22-22 1331ET

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