Dallas students who attended ITT Technical Institute now can receive money back due to a review of how ITT Technical Institute closed. It left many students to default on their loans and did not provide them with completion of their degree or certification program.
“For years, ITT hid its true financial state from borrowers while luring many of them into taking out private loans with misleading and unaffordable terms that may have caused borrowers to leave school,” said U.S. Secretary of Education Miguel Cardona. “Today’s action continues the Department’s efforts to improve and use its targeted loan relief authorities to deliver meaningful help to student borrowers. At the same time, the continued cost of addressing the wrongdoing of ITT and other predatory institutions yet again highlights the need for stronger and faster accountability throughout the federal financial aid system.”
To be eligible, the students cannot have completed their program or transferred any credits from the closed school as it falls under the Higher Education Act. It is the Secretary of Education’s obligation to refund the loans.
At the discretion of Mark Cardona, Secretary of Education, the loan refund will extend to students who attended from March 31, 2008. It was determined that this date would be best due to research into the former school’s bankruptcy hearing records as well as “filings with the U.S. Securities and Exchange Commission (SEC), and from the Consumer Financial Protection Bureau (CFPB). March 31, 2008, is when the company’s executives publicly disclosed the start of a financial scheme that kicked off a series of misrepresentations to hide the true nature of the school’s finances following a public loss of outside financing, which led to shifting additional costs to students and hindered its ability to invest in delivering quality education to students.”
The press release from Aug. 26 may not apply to all students, as some may have already seen their loan returned. Those who were ITT students back in 2016 when the school closed would have already received it in 2019 if they had not returned to school anywhere else within the three years since the closure. Those remaining will be covered by the new loan forgiveness indicated in the press release.
“Borrowers who enrolled elsewhere but did not complete their program of study may still be eligible for a discharge, but will need to submit an application. Borrowers can access the closed school discharge application by contacting their servicer or visiting StudentAid gov/closedschoolform and returning a completed application to their servicer.
“The Department will begin processing discharges in September 2021 and borrowers will start receiving automatic discharges in the following weeks,” said the statement.