The arrangement required cash from an anonymous donor, an activist group and some good will from Morehouse.
When Jordan Young first listened to a voicemail last week explaining that he would have the nearly $21,000 balance on his account with Morehouse College canceled, he was skeptical.
As part of the collaboration, the Debt Collective wiped out $9,710,296 in debt owed to Morehouse by former students. The roughly $9.7 million represented all the debt in collections held by Morehouse for all the terms leading up to fall 2022. To facilitate the debt relief, the Debt Collective’s sister organization, the Rolling Jubilee Fund, purchased the debt from Morehouse for $125,000 and then promptly canceled it.
That two organizations partnered together to cancel debt on their own can help push “the federal government to do more to provide debt relief for student borrowers, Black borrowers in particular,” Douglas said. In the mid-2010s, Rolling Jubilee — named for the year in the Bible when borrowers would be freed from debts after a 49 year cycle — bought up and canceled medical debt as well as the debt of some students who attended Corinthian Colleges, a now-defunct for-profit school.
Nonetheless, “it was still having a big impact on people,” he said. “The math on it was really what made sense in the context of our collaboration.” In addition to the Morehouse debt, the organization used the donation last year to cancel $1.7 million in debt for nearly 500 people who owed the money to Bennett College, a Historically Black liberal arts college for women in North Carolina. The Debt Collective also used the funds to wipe out about $3.2 million in probation debt, owed by roughly 20,522 people in 2021.
Colleges take different approaches to debt owed to them by students Colleges across the country take different approaches to debt owed to them by students and former students. Some withhold transcripts making it difficult for students to continue their education at the school or transfer elsewhere. Others will go as far as taking students to court to collect on the debt.
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