Learn more about Closed School Discharges for Federal Student Loan Borrowers
Closed School Tips and FAQs
Q: Is it ever possible to extend the requirement that I must have withdrawn from the school 120 days before closure?
A: Yes. The government may extend this period if exceptional circumstances apply. You should also note that the period was extended from 90 to 120 days as of July 1, 2014.
Q: Can the government deny the closed school discharge if my school closed but I completed the program at another school? A: Under current regulations, yes, but only if you complete the same or comparable program because you transferred one or more credits earned at the closed school to another school or if the two schools had a written “teach-out” agreement allowing students to complete their courses at another school after the original school closed.
Q: Is there anything I can do to stop collection while I am waiting for a response to a closed school discharge application?
A: Yes. One strategy is to request forbearance. Interest will continue to accrue, but collection will stop. If you want to go back to school before a decision on the discharge is made, you should consider reviewing repayment, loan rehabilitation, and consolidation options.
Q: Can I borrow to return to school if the decision on my closed school discharge is pending?
A: If you are in default, but want to go back to school before a decision on the discharge is made, you should consider reviewing repayment, loan rehabilitation, and consolidation options. You will not be able to return to school and qualify for federal loans as long as your loans are in default. However, if you are not in default, this should not be a problem if you have not exceeded your lifetime student loan limits.
Q: What if I was on a leave of absence when the school closed?
A: A student on an approved leave of absence is treated as if she is still enrolled. If your return date was scheduled before the school closed and you did not return to school after a leave of absence, the withdrawal date will be the date that you began the leave of absence. For purposes of a closed school discharge, a student on an approved leave of absence who tried but could not return to the school because it was closed should still be eligible for the discharge.
Q: What kind of proof can I submit if I think that the official school closure date is wrong?
A: Possible sources of information include dated newspaper articles or other media reports about the school’s closure. You might also try to collect signed statements from other students, state regulators, or former school employees about the closure date.