Direct Loans and Family Federal Education Loans can be discharged if your school closes and you meet these criteria:
  • The school you are enrolled in closes and you cannot complete your program because of it. This also applies for ANY Federal Student Loan taken out to pay for attending that school. If you were on a leave of absence approved by the school, you are still considered to be enrolled.
  • If you withdraw from school, you still qualify if the school closes within 120 days after you have left.
Direct Loans or Family Federal Education Loans will not be discharged under these circumstances:
  • The school closes MORE than 120 days after you withdraw.
  • You are enrolled in a comparable degree program at another school. If you complete this program and have already had your loan discharged, you could be liable to pay back the discharged loan.
  • You have completed the course program, but have not received a diploma or certificate of completion from the school before it closed.

If you cannot obtain a final transcript, gather every document you can that shows you were enrolled in the school. A debt relief specialist can help you use those to secure a loan discharge.