The Department of Education is providing closed-school discharges to 115,000 borrowers who attended the now-defunct ITT Technical Institute, canceling more than $1.1 billion in student loans.
The department said Thursday that the decision was based on “a new review of the problems leading up to ITT’s closure.” It impacts those borrowers who didn’t complete a degree and left ITT Tech on or after March 31, 2008, which is when the for-profit institution began publicly disclosing the beginnings of a financial scheme that led to misrepresentations of its finances.
About 43 percent of the borrowers receiving the closed-school discharge are currently in default on their loans, according to the department’s estimations.
