Closure of ITT Technical Institutes

On Sept. 6, 2016, officials representing ITT Educational Services Inc., the parent company of ITT Technical Institute and Webster College, notified the Department of Education (ED) and therefore the postsecondary education oversight bodies within the 38 states where they need operating locations that they intended to cease online and classroom-based instruction and operations at the 136 ITT Technical Institute locations across the country. On Sept. 16, 2016, ITT filed a Voluntary Petition for Chapter 7 Bankruptcy within the us Bankruptcy Court for the Southern District of Indiana and subsequently ceased all company operations. As a result, all ITT Technical Institutes have lost their eligibility to receive federal student aid funds from ED.

If you were attending ITT when it announced its closure on Sept. 6, 2016, or if you withdrew from an ITT Technical Institute location on or after May 6, 2016, you’ve got two primary options:

Apply for a closed school loan discharge.
or
Transfer earned credits to a different institution to continue your education during a comparable program.

Read our overview of the closed school loan discharge process for more information about the method and eligibility. Students impacted by these closures can also be eligible for State Tuition Recovery Fund refunds. For information on availability and eligibility, see column J of this spreadsheet and see our commonly asked questions page. We encourage you to avoid paying companies for student loan consolidation or forgiveness services that your federal loan servicer provides on behalf of ED for free of charge .

Another great interim option would be an Income-Based Repayment program. The benefit of an IBR is that it’s based strictly on what you earn. It allows for a more affordable monthly payment capped at 10-15% of your discretionary income. Also, an IBR program offers the long-term benefit of student loan forgiveness after 20-25 years of payments. The period depends on when they took the loan. Currently, under IBR programs, amounts forgiven are also treated as taxable income.

If you were attending ITT when it shut down on Sept. 6, 2016, or you withdrew from an ITT Technical Institute on or after May 6, 2016, you have another option. You can transfer earned credits to another institution to continue your education in an equivalent program. Borrowers who are current ITT students, recent graduates, and students who withdrew in the past 120 days can transfer their credits according to the offer by the U.S. Department of Education:

Transfer your credits

If you want to continue your program of study, the U.S. Department of Education is connecting you with community colleges who will transfer over ITT Tech credits.

However, if students opt for this option, they may not be eligible for a closed school discharge on their student loans. Instead, you might want to keep the credits from ITT and transfer them to a similar program in another school.

If you do transfer into a related program offered by another school, that school will evaluate your ITT coursework. It will decide whether to give you credit for already completed works. Also what courses you need to take to complete your program of study.

The Education Department is working with ITT officials and representatives from the state and postsecondary education oversight organizations, to process student records from the 136 schools. So that transfer schools could start evaluating students’ remaining qualifications for Federal Student Aid funds.

ITT will take responsibility for any return of federal student aid funds. The Department will work with ITT officials to make sure the loan funds are restored for future eligibility. If you transfer the credits toward a similar program and you completed or are going to finish that program, you will not be eligible to receive a closed school loan discharge.

We encourage you not to pay for companies for student loan forgiveness or consolidation programs that your federal loan servicer provides for free, on behalf of the Education Department. Your loan servicer, the companies that collect your payments, can also support you with these goals for free of charge. If you need help with your student loans, you should contact your servicer, because you never need to pay for these services.

https://studentloansresolved.com/2019/01/11/closure-of-itt-tech-institutes-student-loan-forgiveness/