COLUMBUS, Ohio (WCMH) — The Department of Education announced on Thursday it will make $1.1 billion available to eliminate loans for 115,000 borrowers who went to ITT Technical Institute.
About 43 per cent of borrowers who went to the shuttered school after March 31, 2008 and didn’t complete their credentials are in default, said the Department of Education in a press release.
ITT engaged in widespread misrepresentations about the true state of its financial health, and misled students into taking out private loans allegedly portrayed as grant aid, the media release said.
The Secretary of Education discharges the loans of borrowers and refunds amounts paid if the borrowers did not complete their program of study because of their school’s closure.
To be eligible for a closed school discharge, the borrower must not have completed their program or transferred their credits or hours to another school. Discharges are also available to any borrower who withdrew from the institution within a few months of its closing. The Secretary of Education may, however, extend this period based on exceptional circumstances.
The Department will begin processing discharges in September 2021 and borrowers will start receiving automatic discharges in the following weeks, the press release concluded.