That’s a drop in the basket of $ 1.6 trillion in outstanding student loans, but students who borrowed money to study at the now defunct ITT received some relief on Friday.
The US Department of Education said that those who attended school but never received their degrees are being forgiven their remaining student debt.
Following a fresh review of the issues that led ITT Tech to close its doors, the agency announced it would provide $ 1.1 billion in closed school statements to an additional 115,000 borrowers – 43% believed to be free of default. … The only condition these borrowers will have to face is that they did not receive an advanced degree or credentials and left ITT Tech on or after March 31, 2008.
As a result of Friday’s action, the total loan repayments approved by the Ministry since January 2021 amounted to $ 9.5 billion, a welcome relief for more than 563,000 student loan borrowers.
“For years, ITT has hidden its true financial situation from borrowers, while at the same time luring many of them to take out private loans on deceptive and unaffordable conditions, which could lead to borrowers dropping out of school,” said the US Secretary of Education. Miguel Cardona.
“Today’s action is a continuation of the Department’s efforts to improve and use its dedicated lending authority to provide meaningful assistance to student borrowers. At the same time, the lingering costs of correcting wrongdoing by ITT and other predatory institutions further underscore the need for stronger and faster accountability across the entire federal bailout system. ”
Steps to take for former ITT Tech students
According to Department of Education regulations, former ITT Tech students who have student loans outstanding should know the following:
They are eligible for loan benefits if they attended an ITT-owned facility that was closed between November 1, 2013 and July 1, 2020.
If they meet the above requirements and do not enroll in another educational institution within three years after school closes, they will receive an automatic loan waiver.
Borrowers who apply elsewhere but do not complete the training program may be eligible for termination, but they will need to apply.
Borrowers can access the school closure application by contacting their service staff or by visiting StudentAid gov / closedschoolform and returning the completed application to your service personnel.
The department will begin processing payments in September 2021, and borrowers will begin receiving automatic payments shortly thereafter.