Posts Tagged ‘school closure


Did your school close? You may be able to discharge your student loans

The Secretary of the Department of Education is required to discharge a specified loan if you are unable to complete the program due your school’s closure.  The regulations provide this discharge if the branch of the school which the student attended closed.  For example, if you attended branch 1, there is no right to discharge if only the main campus or branch 2 closed.  On the other hand, if branch 1 closes, you have a right to a discharge even if all other branches stay open

The regulations provide for a discharge if you were still enrolled at the time of the school’s closure or if you withdrew from the school not more than ninety days before the school’s closure.

A school’s closure date is the date at which it ceases offering all programs at a particular branch, not when it stops offering the particular program in which you are enrolled.  Nevertheless, when a particular program at a location ceases four or five months before the branch closes, this would seem to be an appropriate situation for the Secretary to extend the ninety-day period because of the exceptional circumstances related to the school’s closing.

Borrowers can obtain closed-school discharges if the school closed before they completed a program, even if the school issued the borrower a diploma or other certificate.  On the other hand, if a student completes a program, there is no discharge even if the borrower never received a diploma or certificate.

You must apply for the discharge.  Guarantors must forbear collecting once you’ve applied.

If you have loans due for schooling you received at a closed school before receiving your certificate or diploma, you may be eligible to discharge your loans.  Please contact the Zarcone Law Firm at 619-800-3082 for a FREE consultation.


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The content found on the financialfreshstart Blog is not legal advice and is purely for informational purposes. The Zarcone Law Firm does not guarantee the accuracy, integrity or quality of submissions. The information provided by the bloggers on this site may not represent the opinions of the Zarcone Law Firm or its affiliates. The information contained herein is not a substitute for the advice of an attorney.

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