Looking to get your loans forgiven because your school closed?
You may be able to do that.
Here’s what I mean.
- What happens to my degree if the school closes
- Download Loan Discharge Application School Closure Form
- How to find the school closure date
- Where to submit the closed discharge application
- What happens after you submit the application
Yes, it’s possible to get federal student loan forgiveness if your school closed.
Eligible Federal Loans
Pretty much, all your loans that are federal are eligible for closed school discharge no matter of your educational program of study. This includes: William D. Ford Federal Direct Loans, the Federal Family Education Loans (FFEL Loans), the Perkins Loan, Parent Plus Loans, Stafford Loans, and consolidation loans.
But few people will be able to do so.
About Private Student Loans
Private loans don’t have a similar program to the federal government’s for closed school discharges. In my experience, you have only two options to get rid of your loan debt: settlement or bankruptcy.
The U.S. Department of Education’s eligibility requirements for a closed school loan discharge are strict.
You qualify if you did not complete your coursework at a comparable program of study at another school through a teach-out and:
- You were enrolled when the school closed or
- You were on an approved leave of absence when the school closed or
- Your school closed within 120 days after you withdrew
In other words, you’re eligible for a closed school discharge only if you couldn’t complete your education because the school closed.
So if you attended a school like Sanford Brown, ITT Tech, or Art Institute, and that school closed well after you left, then you’re not eligible for a closed school discharge.
What Happens to my Degree if the School Closes
The short answer is nothing.
Your degree remains valid if your school closes.
But, and here’s the big problem as you already know, is that your degree is, for the most part, worthless.
Your employer could care less that you have a masters degree from Kaplan University or a law degree from Charlotte School of Law.