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Guide to Extended Closed School Loan Relief for Dream Center Students

This blog post is intended to provide information on closed school discharge eligibility for students who attended Dream Center-owned schools, as well as parent PLUS borrowers who took out loans for such students. All student and parent borrowers should be aware that the Department of Education has extended the eligibility date to qualify for closed school relief depending on which school you attended. This is the current lay of the land:

  • Illinois Institute of Art, Art Institute of Colorado, and Art Institute of Michigan:  If you attended any of those schools after they lost accreditation on January 20, 2018—and if you otherwise meet the criteria to receive a closed school discharge (meaning you did not graduate or transfer credits into a comparable program)—you are eligible for a complete discharge of your federal loans and a refund of payments made.  You can apply today by filling out this form and sending it to your student loan servicer.

  • All other Dream Center-owned schools: If you attended any other Dream Center-owned school on or after June 29, 2018—and if you otherwise meet the criteria to receive a closed school discharge (meaning you did not graduate or transfer credits into a comparable program)—you are eligible for a complete discharge of your federal loans and a refund of payments made.  You can apply today by filling out this form and sending it to your student loan servicer.   

MORE INFORMATION 

Former students who obtained federal student loans to attend Dream Center schools in 2018 should keep in mind the following: 

  1. Eligibility: As explained above, in order to be eligible for relief, borrowers must have been enrolled or on an approved leave of absence from the school on or after: January 20, 2018 (for Illinois, Colorado and Michigan Ai students) or June 29, 2018 (for all other Dream Center-owned schools).  Further, borrowers must otherwise be eligible for a closed school discharge, meaning they did not graduate, participate in a teach-out for a similar program, or transfer their credits into a comparable program at any other school. 

  1. Process: Your loan servicer is supposed to send you a notice with the above information and a copy of the closed school discharge application, but you do not need to wait to apply.  Simply fill out THIS FORM and send it to your servicer. The U.S. Department of Education advises that borrowers continue to make payments on their loans while their discharge application is being processed.

  2. Beware: The U.S. Department of Education advises borrowers to beware of third-party companies and student debt relief scams that advertise assistance with student loans, including assistance with closed school discharge. Borrowers should be aware that the process of applying for closed school loan relief is straight-forward and free – you just need to fill out the form linked to above.  

 

MORE INFORMATION FOR ILLINOIS INSTITUTE OF ART, ART INSTITUTE OF COLORADO, AND ART INSTITUTE OF MICHIGAN BORROWERS:

In October of 2019, former students at the Art Institute of Colorado and the Illinois Institute of Art (which included the Art Institute of Michigan), represented by the non-profit legal advocacy group Student Defense, sued the U.S. Department of Education and Secretary Betsy DeVos in federal court in Washington DC. Court documents revealed that the Department continued to provide federal student aid to the schools after learning that they were unaccredited, and therefore ineligible to receive such federal student funds.

On the eve of a deadline in the Student Defense case, the Department agreed to a central demand in the litigation: to extend the closed school discharge date back to the date the schools lost accreditation, January 20, 2018. Students who were enrolled on or after this date and are otherwise eligible for a closed school discharge can now apply for and receive a full discharge and refund of any payments made on the federal student loans used to attend those schools. This applies to both student and parent borrowers. 

Borrowers seeking further assistance may contact Student Defense at info@defendstudents.org.

*Nothing in this blog post should be construed as legal or financial advice.