Student Loan Forgiveness via Borrower’s Defense to Repayment

In 2017, the best way to get out of paying back your student loans is to take advantage of the Borrowers Defense Against Repayment provision of the Higher Education Act of 1965.

Many Americans have recently become aware of this excellent opportunity to receive complete forgiveness from excessive student loan debt, mostly thanks to recent developments like the formation of the ITT Tech Student Loan Forgiveness Program, the DeVry Student Loan Forgiveness Program, and the Corinthian Colleges Student Loan Forgiveness Program.

The “Defense Against Repayment” provision is an often overlooked statute buried within the U.S. Higher Education Act of 1965, but one that is growing rapidly on popularity, as it states that the Department of Education is authorized to allow students to get out of paying back their Federal student loans if they can prove that they faced “acts or omissions of an institute of higher education”.

What does that mean? Simply stated, if your school ever lied to you about anything, like overstating your job prospects, promising you salary expectations, or guaranteeing you management positions, then you can petition the Federal Government to invalidate your student loans, and discharge them entirely.

This works for any sort of violation of State or Federal laws that the school may have committed, but it also applies to student loan servicing companies (in some cases), where you’re able to get Federal Student Loan Forgiveness because the servicer lied to you, didn’t give you the right information, made some false promise, or cheated you in some way.

The Navient Student Loan Forgiveness Program is a great example of this sort of thing, where Navient failed to properly support their borrowers, and is now being sued by the Consumer Financial Protection Bureau.

Bottom line: while we wait for President Trump’s Student Loan Reforms to be announced, your best bet at getting your Federal loans discharged, reduced, or in some other way dealt with is to pursue a Borrowers Defense Against Repayment discharge.

But Before We Get Into How Borrower’s Defense Letters Work…

If you’re in a hurry to deal with your student loan debt, or if you don’t have hours to spend researching and creating your Defense Against Repayment Letter, then consider calling the Student Loan Relief Helpline at 1-888-906-3065.

The Student Loan Relief Helpline will take down your financial information, give you advice on your options for attacking your outstanding student loan debt, and explain how the process works.

The call and initial discussion are free, but you will also be offered the chance to pay the Student Loan Relief Helpline to take care of all the hard work involved in the Defense Against Repayment Process for you. Whether you choose to pay for that service or not, I definitely think it’s worth calling the Helpline to get assistance in figuring out your options.

And if you’re not interested… simply read on, because the rest of this post will teach you how to handle the Defense Against Repayment Process entirely on your own.

How Does the Defense to Repayment Provision Work?

It’s important that you fully understand how the defense to repayment provision works, because getting approval for a defense to repayment discharge requires making a sophisticated legal argument that your school violated the law in some way, essentially tricking you into taking on student loan debt due to their false promises that it would be worth the cost.

Receiving approval for a defense against repayment argument involves collecting evidence and presenting the Department of Education with proof “that the school did something wrong or failed to do something that it should have done”, which is provided in the form of the Borrowers Defense Against Repayment letter.

Importantly, this law also stipulates that you may only rely on the defense against repayment argument if the school’s act or omission was directly related to your loans, or to the educational services that the loan was intended to pay for, and if what the school did (or didn’t do) would be considered a violation of state law.

That means you can’t accuse the school of doing something illegal, and get your loans discharged, if their illegal behavior had no impact on your decision to take out student loans to pay for their services.

How Do You File For a Defense Against Repayment Discharge?

Perhaps the worst part of the defense to repayment process is the way that you have to pursue the discharge – you’re forced to submit information to your loan servicer, who will evaluate what you’ve presented and determine whether or not you deserve to have your loan forgiven.

What loan servicer is likely to agree to sacrifice repayment on their outstanding loans? None that I’m aware of, which means that pursuing this opportunity means you’d better be prepared for a knock-down, drag-out fight.

And in many cases, this is why it requires paying someone for assistance to get an approval for your Borrowers Defense Against Repayment letter. Lawyers, and specialty debt resolution companies are your best bet when it comes to outsourcing the work to someone else, but it’s vital that you choose carefully, because there are many scams now operating in this industry.

Where Did Borrowers Defense to Repayment Become Popular All of the Sudden?

It’s kind of funny that this little legal provision from way back in 1965 is only now starting to receive so much attention, but that’s happening for one very good reason.

The now defunct Corinthian Colleges, notorious day-time advertiser and parent company of the largest for-profit schools chain in the United States, home to Everest, Heald and WyoTech, is the reason for this provision’s newfound popularity.

When Corinthian collapsed under the weight of its own corruption (and the added pressure placed on it by a series of Federal investigations for fraud and deceptive business practices), a huge portion of it’s thousands of students found themselves between a rock and a hard place.

These were students who had racked up tens of thousands of dollars in debt, but who now had zero chance of receiving a diploma that would help them to land jobs capable of providing income streams to pay that debt back.

These were students who had sunk thousands of hours, and tens of thousands of dollars, into education programs that would never lead to degrees of any sort.

But these students decided to do something about their unique situation, and they accomplished something that no previous generation of debt-saddled college kids had managed to accomplish: they went on strike, publicly swearing to refuse to pay back their debt, and the media covered their efforts!

Birth of the Student Loan Debt Strikers

Initially called The Corinthian 15, this group of student loan strikers received a tremendous amount of media attention, raising enough awareness for their problem that the entire country began to take notice of what was going on, and earning enough sympathy to get a federal hearing scheduled with the Department of Education.

Fortunately, DOE sided with the debt strikers, and on June 8th, 2015, announced that they would support the tens of thousands of students caught up in the collapse of Corinthian Colleges.

But the best part of the whole deal was that the Department of Education was serious about their promise to help those now saddled with excessive student loan debt, as they publicly affirmed that those students would be able to qualify for a comprehensive student loan forgiveness program, governed by the old 1965 defense against repayment provision.

Forgiveness Expands Outside the Corinthian System

The great news for those of you who did not attend a Corinthian-affiliated school is that it’s not the only case under which defense against repayment may be invoked.

In fact, the Department of Education itself made clear that other schools (especially those operating in the for-profit sector), would also be covered under the conditions of the provision.

Along those lines, the Consumer Financial Protection Bureau went to the mat on behalf of begrudged students by filing a lawsuit against the for-profit ITT schools, stating that ITT has “exploited its students and pushed them into high-cost private student loans that were very likely to end in default.”

And that’s serious business, because while you may not know anyone who attended an ITT school, this massive for-profit educator enrolls about 70,000 students per year (far more than most of the big schools you ARE familiar with).

That single suit seems to have opened the floodgates for others seeking to qualify under the defense to repayment provision, encouraging millions of other students who now feel like it may be possible to get out of paying back their student loans.

How Can I Apply for Defense Against Repayment Forgiveness?

While the good news is that it is possible to qualify for a discharge under the defense against repayment provision, the bad news is that it’s not an easy process.

However, at least the Department of Education has caught up with the times, and now you can find a Borrowers Defense Against Repayment form available directly from their website, here.

This has made the process much easier than it was before when only a loose set of guidelines were provided, and people had to figure out what to include, how to structure their letters, and everything else about them entirely on their own, so if you haven’t yet filled out one of these letters, now is definitely the time to get started.

Also, as I mentioned earlier in this post, what you’ll need to do is prove that your school committed some sort of fraudulent activity by either doing something, or failing to do something, which influenced your decision to enroll in their education program, but which also violated applicable state law.

If your school convinced you to sign up for their expensive program because they made promises about your ability to pay back the loan (either by inflating job placement rates, salary statistics, or some other similar data), then you’ll have a pretty good shot at qualifying for a defense against repayment discharge.

Make sure you include as much detail as possible (relevant detail), in your application letter and provide specific details about how you were lied to, what you were promised, told, or not told about, to clearly explain why you believe the school violated some law.

In your defense against repayment letter, I would encourage you to include detailed explanations of each of the following things:

How to Write a Defense To Repayment Letter

  • A written statement saying that you “Wish to assert a borrower defense to repayment based on state law”
  • Your first, middle and last name (use your official legal name)
  • Your date of birth
  • Your home address
  • Your email address
  • Your telephone number
  • The last four digits of your Social Security number
  • The name and address of the school you attended
  • The name of the certificate or degree program you earned, or were seeking to complete (both people who completed their programs, and people who didn’t, are eligible for a defense to repayment discharge)
  • The dates you were enrolled at the school
  • Documentation to prove that you were enrolled in the school, for the program you specified (use your transcripts or registration docs for this)
  • A detailed explanation of how your school defrauded you, including a description of which state law or cause of action your school violated, an explanation of how their alleged misconduct affected your decision to attend the school (and take out loans to pay for the program), and the damage you’ve suffered (likely an explanation of your ruined finances) as a result of the school’s alleged behavior

Sounds Simple, Right?

If you think that the above list of requirements seems simple, please read through them again to be sure that you fully understand what you’re being asked to provide.

This is not a simple yes/no type application, or even a basic multiple-choice type form. You’ve literally got to prove the fact that you were defrauded (lied to in some way), and screwed over by your school.

For most people, that’s not an easy argument to make, so if you aren’t a great writer, then I’d advise you consult with an attorney for assistance to ensure that your application is rock-solid.

I haven’t run into anything explaining how the appeals process will work for defense to repayment applications, and I’m not yet sure if you’ll even be offered a second round chance at getting an approval once your initial application is submitted and denied.

What’s that mean? It means you’ve got a lot to lose by screwing this up, and that you should probably pay a lawyer to review whatever you put together to ensure that you haven’t made any mistakes.

What Kinds of Things Constitute Being Defrauded?

What sorts of things can you use as examples of having been defrauded by your school? I’m glad you asked!

Let’s say your school told you that you’d be able to earn an income of $XX.XX per hour, or $XX,XXX per year after graduating from their program – there’s your argument that they defrauded you!

Or what if your school promised that completing their graduate program would let you land that coveted management position you’ve had your eyes on for so many years? There’s your argument!

In a nutshell, any promise of earning potential, job placement rates, or work title could land your school in hot water, allowing you to qualify for a defense to repayment discharge.

Keep Making Your Monthly Payments

One thing to keep in mind is that you can’t simply give up on paying back your student loans at the time you submit your defense against repayment application.

While the Department of Education WILL place your student loans into forbearance from the very moment that they receive your application, those loans will continue to generate interest even as they’re paused and DOE works on investigating your claim.

What’s that mean? You need to keep making your monthly payments until you’ve received an official, written notice from the Department of Education that your loans are being discharged. Up until that point, don’t neglect to send in that monthly check, or you might end up in even worse financial shape than when you started down the discharge path!

What Should I Do?

Here’s what I’m telling all my friends and family members facing a similar situation to your own: “Please hire a lawyer or a debt resolution company, consult with them on how best to proceed, and don’t do anything without first spending some serious time investigating this important opportunity.”

Jumping into the defense against repayment pool without first testing the waters by researching the opportunity in detail is likely to lead to disappointment, and potential financial ruin.

Be careful about how you proceed with your application, as no one really knows how all of this is going to shake out. Will it be easy to get approval for your application, or will DOE place ridiculous restrictions on handing out these forgiveness benefits?

Honestly, only very few of the Borrowers Defense to Repayment applications are being approved so far, so I’m still not entirely sure if this is a great debt forgiveness program, or a niche opportunity that only a few people will get to take advantage of.

What I do know for certain is that you’ll increase your odds of getting your debt discharged if you do hire an expert to help, and my favorite experts are the people at the Student Loan Relief Helpline.

This is a paid service that will handle all the work for you, for a cost, but your first call and discussion with them is entirely free, so my recommendation is to call them, give them the details of your situation, and see what it would cost for them to help you out.

You can reach the Student Loan Relief Helpline by calling 1-888-906-3065, and I recommend doing so as soon as possible.

Questions About Defense to Repayment Application Letters

If this all seems confusing to you, then I’ve got one final piece of good news – the Federal Government created a helpline dedicated to questions about the defense to repayment provision, and you can call it right now to get some free advice on your unique situation.

For any questions that you might have which you don’t want to ask in the comments section below, please feel free to call the Government’s official Borrower Defense Hotline at (855) 279-6207.

This hotline has representatives available to walk you through the defense to repayment process on weekdays from 8:00am to 8:00pm EST.

Other Questions?

Don’t want to call the Government helpline?

Feel free to ask anything you’d like in the comments section below.

I’ll do my best to get you a response within a day or two, though I can’t promise that I’ll have a great answer since this program still involves a great deal of mystery.

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Tim's experience battling crushing student loan debt led him to create the website Forget Student Loan Debt, where he offers advice on dealing with excessive student loans and advocates a cautious approach to funding education costs via borrowed money.