The forgery discharge is one type of false certification discharge. It is also called the “unauthorized signature” discharge. You are eligible for this discharge if the school forged your name on the loan papers or check endorsements. In order to qualify, you must not have received the proceeds of the loan.
This is a limited program. It does not apply in all cases where a signature was forged, only if someone affiliated with the school signed your name without authorization. If someone else forged the signature, you are not eligible for this discharge, but you may still raise forgery as a defense to collection of the loan.
How to Apply for an Unauthorized Signature Discharge
In most cases, you will have to fill out a form to apply.(There are limited cases in which the government will accept an oral application). You should send by certified mail and get a receipt.
You must submit four samples of your signature in addition to the signature on the application. One of the most difficult requirements is that at least two of these sample signatures must have been written within one year before or after the date that the forgery occurred. Examples of documents that would include both a signature and the date the signature was made include canceled checks, tax returns, and driver’s licenses.
There is no deadline to apply for these discharges. Direct Loan borrowers must apply to the Department of Education and FFEL borrowers should apply to the lender or agency holding the loan. If this is a guaranty agency, the agency is supposed to respond within 90 days.
If the discharge is granted, you are no longer obligated to repay the loan or any charges or costs associated with the loan. In addition, you have the right to be reimbursed for all amounts paid on the loan, whether those payments were voluntary or involuntary. You are no longer in default on these loans and the loan holder must help clean up your credit history. If the discharge is denied, you may first seek review from the Department of Education and then if necessary, appeal to federal court.