ITT Tech Student Loan Forgiveness

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What Happened at ITT Tech?

In 2016, one of the largest for-profit educational institutions of the U.S – ITT Tech- announced its closure. The main reasons for closure were the dispute between the Department of Education and the school, which left no other way for ITT, except announcing the closure. Sure, these disputes did not start without reasonable arguments. It was alleged that the school utilizes pressuring tactics in enrollment to attract students. False paperwork and low quality of education, as well as a high default rate on its loans, also triggered the problem.

 

Quality of Education

One of the reasons for inadequate education quality was grade inflation. In 2011, investigational research claimed that educators consciously increased grades to get more student aid from the government. In some cases, educators were not prepared for classes or even absent from classes.  High pressure in recruitment tactics led to the enrollment of students with low educational skills, such as not being able to complete basic math questions. Hence, the quality of education and outcomes were not desirable.

High Default Rate

In 2013, ITT tech was a school that had a higher percentage of default on its loans than its graduation. At that time, around a quarter of graduates defaulted on their loans, while the average statistics was only 13%. Students usually defaulted, because they did not know the real total cost of the loans. They only realized their debt after receiving the loan, and sometimes, the interest rate could be as high as 16.25%.  

 

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Recruitment Tactics

A whistleblower lawsuit started when there emerged a claim that the school paid recruiters sales commissions per student they enrolled. Additionally, the school encouraged its recruiters to mislead prospective students about the programs’ costs and the transferability of their credits. Allegedly, they also misinformed veterans that they would not get any debt.

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The Response of the ED

Sure, after all these claims about mismanagement of ITT Tech, the Department of Education started taking some measures against the school. In 2016, shortly before its closure, the ED perceived the extreme risk of bankruptcy and required the school to double its funds that would cover defaults. The Department of Education obliged ITT to prepare this financial resource in 30 days. Even worse, the ED banned the school from enrolling students who needed the federal student aid as the default rates were very high. At that time, more than 60% of revenues were coming from students with federal loans. Hence, such an announcement quickly showed its consequence on stock prices. Finally, two weeks after the introduction of new requirements, ITT Tech announced it ceases its operations. This decision affected around 40000 students and 8000 employees working there. 

Luckily…

While we understand that school disclosure was devastating news for students and the Department of Education took proper measures to decrease its negative consequences. For instance, they tried to make sure that students can transfer their credits to different institutions and continue education to complete their degree programs. Yet, the most significant help was the availability of debt forgiveness programs. 

...You Can Get Rid of Your Debt!

Students enrolled in ITT tech at the time of its closure- 2016- can be eligible for loan forgiveness programs. Also, those who attended up to ten years before this date are qualified. The closure of ITT can make students qualified for two programs. These are the Borrower Defense Against Loan Repayment and Closed School Discharge to eliminate the accumulated debt for educational purposes. Even years after the closure, in 2020 January, the Department of Education granted forgiveness to more than 7000 students and canceled their debts worth $95.1 million. Therefore, if you think you can be qualified for the program, it is an excellent opportunity to stop all your concerns about the loans. 

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The Very First Step of Debt Forgiveness

Before delving into the details of the available programs and answering the main questions, let us share a vital notice with you. As attractive as it might seem, especially with the recent forgiveness announcements, it is hard to get rid of debts with federal assistance. Sure, former students of ITT tech have a high chance of debt cancellation through both School Closure Discharge and Borrower Defense Against Loans. However, it will most likely take years if you do not receive any third-party help. 

Get Our Help Now!

As a basic example, consider the latest announcement- students could only get rid of their debts four years after the closure. Hence, we would recommend you to contact us and get straight to work for fast and proper application. Our experts have dealt with hundreds of such cases. They are aware of all dos and don’ts of application processes to fully exploit your opportunity for a debtless future. We will guide you through the whole process and make sure you do not waste your chance with technical mistakes or misunderstandings because of complex requirements. Contact us now to get the Student Loans Resolved team by your side. 

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Borrower Defense Against Loan Repayment Program

One of the options to eliminate debt for former students of ITT is the Borrower Defense Against Loan Repayment plan. This program helps students that can prove that unlawful and fraudulent activities of schools misled them. Otherwise, they would not have incurred the debt for educational purposes. Such claims can include false advertising, high-pressure recruitment tactics, or false promises of institutions. It is evident that many students enrolled could have been influenced by fraudulent actions, considering the legal issues the ITT Tech was involved in. Therefore, such conditions create the perfect ground for applying and getting the benefit of the Borrower Defense to Repayment program. If you can prove the school’s mismanagement and deceptive practices toward your enrollment, you will get 100% of your debt discharged. 

Application to the BDALR

There is an online platform to include all details of your case and apply for debt forgiveness. You will be required to answer some questions to prove that the school misled you and upload documents such as a transcript. However, the way you fill the application is the most crucial element in convincing the ED to discharge your debt. You have to prove that ITT deceived you by giving false promises. If the recruiters lied about accreditation, job opportunities, credit transfers, or did not provide enough information about debt obligations, then you can get rid of your student debt. Also, be careful not to exaggerate or lie about the claims in your application. Even if the ITT Tech truly misled you, your exaggeration of issues could be against your request, and you can fail. 

We have worked with many similar cases, and our experts have a full understanding of the application process. If you have studied at Phoenix University, you have an excellent opportunity to get rid of your loans. Do not waste your chance with tiny mistakes. Let us be your guiding light to a debtless future. 

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Closed School Loan Discharge Program

If the ITT Tech became defunct while you were enrolled, on the approved absence, or within 120 days after your withdrawal, then you can be eligible for the Closed School Loan Discharge program. This debt relief program will eliminate all your Direct, FFED, and Perkin Loans taken for educational objectives. You can even receive reimbursement of the payments you made for ITT loans till now. Also, keep in mind that you will not be eligible if you transfer your credits to a new school where you get a comparable degree. For application, all you need to do is to fill a form that you can request from your loan servicer. 

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FAQ

Can I Apply Both the BDALR and Closing School Discharge Program?

Unfortunately, you cannot apply to both programs at the same time. Therefore, you should be well-aware of their requirements and your fit for the programs before choosing one of them. Researching or getting help from Student Loans Resolved experts to find the best plan for you would increase your chance of getting the benefit.

How Can I Prove That the School Misled me?

The main thing that matters is the information and details you input to the application form. You can add promotional material, emails, course catalogs with false information, and explain how they misinformed you. Plus, linking your case to previous cases in lawsuits can strengthen your claims. 

Which Program to Apply if I transferred My Credits?

If you decided to pursue your education in another institution, and transferred credits, then you are not eligible for the School Closure Discharge program. However, you can still apply for Borrowers Defense to Repayment if you faced any fraudulent issues during enrollment.

Where Can I Find My Loan Servicer?

If you do not know who is servicing your loan, you can log in to your account in Federal Student Aid to find it. Alternatively, you can also call 1-800-4-FED-AID.

Should I Pay Income Tax for School Closure Discharge?

The benefit received from the discharge program is not taxable. IT means, you do not need to report this amount as income and pay any taxes for the forgiven amount.

Which Program to Apply to Eliminate Private Loans?

Unfortunately, neither of the options for debt relief covers private loans. The only way to find a solution for eliminating the private debt entirely or partially can be through the discussion with your lender. 

Can I Apply for These Programs if I Graduated Before Closure?

Students who graduated before 2016 September can still get rid of their loans. You should prove that the school violated state laws and engaged in fraudulent activities at the time of your enrollment. The Borrower Defense Against Loan Repayment program can be a good option for this purpose. If you cannot prove misconduct, you should continue making payments.

Can I be Eligible to Closed School Discharge if I enrolled at Another Institution?

If you transferred your credits from ITT Tech to another school, then you are not qualified to Closed School Discharge. However, you can get the help of the BDALR if your school misled or deceived you. Also, if you enrolled in another school but did not transfer any credits from ITT, you will be eligible for the discharge program.

How Comparability of New Programs Affect My Eligibility?

The Closed School Discharge program does not benefit students who got their degrees in another school in a comparable program. However, if your new program is entirely different than the previous one in ITT Tech, it is not comparable and is eligible for the discharge benefit. 

 

How the Department of Education Defines Comparability?

Several factors define comparability. The Department of Education checks:

  • the academic contents of programs
  • the similarity in course obligations
  • and how the credit transfer process to a new school occurred to determine your eligibility.

Do not forget that you must act in good faith and honestly answers questions regarding comparability in the application form. Otherwise, you can lose your chance for defunct ITT Tech discharge benefits.

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