On November 1, 2016, Weston Educational Inc. closed its Missouri College campus in Brentwood and its Heritage College campus in Kansas City. These are just the most recent in a series of for-profit school closings in the past 18 months.
“Students and faculty are placed in a very difficult position when their schools close. Unfortunately, there is often a lack of information available for those who need it most,” Koster said. “We encourage students to file complaints with our office. This allows us to update them when information becomes available,” he added.
Fortunately, students and parents who took out federal educational loans for these closed schools may be eligible to have that federal loan debt forgiven. Borrowers—including parents borrowing under the PLUS Loan program—who took out federal Direct Loans, Federal Family Education Loan (FFEL) program loans, or federal Perkins Loans to pay for expenses at these schools may be able to have those federal loans forgiven if the school closed while they were enrolled and they did not complete their program because of the closure or their school closed within 120 days after they had withdrawn.
Borrowers are not eligible for a closed-school discharge, however, if they continue their program at another school through a formal “teach-out agreement” arranged with another school or transfer their academic credits into a similar program at another school. Also, private, non-federal loans are not dischargeable through this program.
Students and parents interested in seeking forgiveness of their federal loans because of these closings can learn more by visiting the U.S. Department of Education’s website: www.studentaid.ed.gov/sa/repay-loans/forgiveness-cancellation/closed-school.