As previously shared in Today’s News, NASFAA, the Western Association of Student Financial Aid Administrators (WASFAA), the California Association of Student Financial Aid Administrators (CASFAA), and Beyond 12 began a partnership at the start of June 2015 to connect students displaced by the closure of Corinthian Colleges – and those who felt they were victims of fraud regardless of whether or not their campus closed – with volunteers who are knowledgeable about higher education, academic planning and financial aid.
At the onset of this partnership the U.S. Department of Education (ED) provided guidance on how eligible students could apply for closed-school federal loan discharge and extended the general 120-day window to June 20, 2014, due to the extenuating circumstances of this situation. Students who believe they were victims of fraud, regardless of whether their school closed, are allowed to seek loan forgiveness under the “defense to repayment” or “borrower’s defense” law. While ED has yet to issue specific guidance for these students, with the exception of Heald College, it has appointed a Special Master, Joseph A. Smith, who will inform the debt relief process for former Corinthian Colleges students.
As mentioned by Lynn Mahaffie of ED’s Office of Federal Student Aid during the closing session at NASFAA’S National Conference, until the for-profit college chain closed in April 2015, ED had only received a handful of requests for “defense to repayment,” and handled them piecemeal. She said ED has already received thousands of requests, and is expecting tens of thousands in total. “We are trying very hard to group students together into categories and making decisions based on the category,” she said. “We certainly hope we never find ourselves in a situation like this again.”
For their part, more than 22 financial aid administrators from CASFAA have assisted over 450 student tickets related to financial aid questions as of late July. Overall this partnership has assisted more than 800 students on issues ranging from transcript requests, transfer services, academic counseling, and financial aid with the help of other organizations such as California State University (CSU) Fullerton. Since there is no current guidance on how to assist students who feel they were victims of fraud outside of Heald College, the partnership is flagging those inquiries for follow-up once more details are released. This initiative is scheduled to continue until the end of September, and there are still ways your office can help.
Publication Date: 7/28/2015