How Can I Apply for an AIU Student Loan Discharge or Refund?
I’ve got news news for AIU students! Anyone who attended American InterContinental University may be eligible for a complete student loan discharge or even a full refund, thanks to a lawsuit that 49 States Attorney Generals just settled with the school’s parent company, the Career Education Corporation.
On January 3rd, 2019, terms of the Career Education Corporation Lawsuit Settlement were released, and they look fantastic for borrowers who attended any of their schools, including anyone who attended American InterContinental University, Le Cordon Bleu or Colorado Technical University.
Forgiveness will be offered to about 179,000 borrowers from the three schools, but only on loans offered directly from Career Education Corporation itself, meaning that this only covers so-called “institutional student loans”, and doesn’t offer relief for Federal or other Private debt.
Basically, your debt will be entirely cancelled if you took loans out from Career Education Corporation itself, but if you have Federal or other Private loans for AmericanIntercontinental University, then you’ll need to seek other avenues for achieving debt relief.
What Are the Terms of the Lawsuit Settlement?
Career Education Corporation is being forced to stop attempting to collect money for any loans they offered to AmericanIntercontinental University students, and they’ve also been ordered to contact the Credit Bureaus and ask them to remove all AIU debt from borrower’s credit reports.
And that’s a big deal, because it means that if you owe CEC money for attending AIU, it’ll literally be disappearing from your credit report, which should skyrocket your credit score, especially if you were in delinquency, default, or having any other sorts of issues with making timely repayments.
I do want to point out that AmericanIntercontinental University is not closing down, or at least that this hasn’t been announced as of yet, but they are going to have to start being more transparent about the value they offer to potential new students, as the lawsuit also stipulates they’re going to be forced to report several important metrics to anyone considering enrolling in the school.
Per the lawsuit settlement, AIU will have to provide a simple, straightforward one page document to all future students which details their job placement rates, the estimated costs of the program the applicant is considering attending, and the average earnings for graduates from that program, in order to better explain the potential value this program offers to students.
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How Does the Settlement Fit Into the Bigger Picture of the Student Loan Debt Crisis?
In my opinion, this is a huge step in the right direction for college disclosure rules, and hopefully it’ll set a precedent that other schools will also be forced to comply with, as these sorts of things could definitely make a big impact on the wider student loan debt crisis.
What I love about this settlement is that a parent company (the lender and servicer) is being slapped, hard, for the school’s misbehavior, and I think that’s the best way to prevent these sorts of schools from continuing the literal scam operations that they’ve been running for several decades.
Why? Because in the past, schools have gotten in trouble and been forced to close down, but the parent companies have gotten away with everything and been able to reopen new schools under new brand names, basically doing the same thing without having any issues at all!
In this case, however, the parent company is getting slammed, the schools will have to change their recruiting tactics, and it sets a great precedent for States Attorney Generals or Class-Action Lawyers to put together cases against the other big for-profit companies who continue to leech funds from unsuspecting borrowers.
Where I Find the Settlement Lacking…
However, there is one huge downside to this settlement, in that it only covers those institutional loans I mentioned earlier in this post, meaning that if you owe money to AIU that was borrowed via Federal student loans, or Private student loans from a company that isn’t Career Education Corporation, then you’ll have to seek other avenues for financial relief.
Finally, no one yet knows how this will all play out, as the details of the lawsuit were just announced and we haven’t yet been told when the loans will be cancelled, whether or not refunds will be issued, or even how borrowers will be notified that their loans are being forgiven, so you’re going to need to follow this story for updates.
I’ll post new information as it’s released, so be sure to bookmark this post and come back to it every couple days, or at least weekly, for the latest news.
What if I Have Federal Student Loans from AIU?
If your American InterContinental Loans are Federally-funded, then you won’t be receiving a complete discharge or forgiveness benefits from this lawsuit settlement, but the good news is that you are eligible to get one via the Borrower’s Defense to Repayment Program.
Abbreviated BDAR, the Borrower’s Defense to Repayment Program is a Federal Student Loan Forgiveness Program that lets people eliminate loans which should never have been created in the first place, because they were scammed by a school or lender who convinced them to borrow money they really didn’t need.
The way it plays out is that you have to convince the Department of Education that you only borrowed money to attend AIU because you were lied to, offered false promises, or tricked into thinking that the school was going to help you get ahead in life, and that if the school hadn’t committed some sort of illegal activity against you, you never would have agreed to take out the funds.
The nice thing about this AIU lawsuit settlement is that AIU’s parent company has basically admitted to committing several types of fraud against it’s students, including making false claims about job placement rates, average incomes of graduates, and the value of their education programs, each of which can be used as points of evidence for why you deserve to qualify for a Borrower’s Defense Discharge.
My recommendation to any AIU student with Federal student loan debt is to immediately submit a BDAR discharge application, using the details of this lawsuit and the ruling against AIU as the evidence that fraud was committed against you, and clearly documenting what sorts of misleading or false claims the school made in order to convince you to borrow money to cover their tuition.
For details on how exactly to handle this process, please visit my Guide on the Borrower’s Defense to Repayment Program, here.
What if I Have Student Loans from Other Schools?
If you’ve got loans from other schools, including schools that aren’t part of the Career Education Corporation umbrella, then you’ll need to look at other options for getting rid of that debt.
If you need help with Federal loans, you’ll want to review my Guides on the following topics:
- Federal Student Loan Forgiveness Programs
- Federal Student Loan Bankruptcy Discharges
- Federal Student Loan Consolidation Programs
- Federal Student Loan Delinquency & Default Help
- Federal Student Loan Rehabilitation
- Stopping Federal Student Loan Wage Garnishments
- Federal Student Loan Deferment Programs
- Federal Student Loan Forbearance Programs
- Federal Student Loan Repayment Plans
- Federal Student Loan Grace Periods
And if you need help with Private loans, then you’ll definitely want to check out my Guides on:
- Private Student Loan Forgiveness Programs
- Private Student Loan Consolidation Programs
- Private Student Loan Bankruptcy Discharges
- Private Student Loan Default Help
It’s almost guaranteed that you’ll qualify for one or more of the programs listed above, no matter who you are, where you went to school, what you studied, or what you do now, as there are tons of different ways to satisfy the eligibility requirements for these debt relief programs.
Where Can I Ask Other Questions?
I’m happy to provide advice and answer any questions you might have about student loans, so please feel free to leave them in the Comments section found at the bottom of this page.
I’ll do my best to respond to any Comments left here within 24 hours, so if you’re not in a huge hurry, I should be able to help.
If you need immediate assistance, my advice is to contact your loan servicer, or the Federal Student Aid Information Center, at 1-800-4-FED-AID.
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Thank you for visiting Forget Student Loan Debt, and please do make sure to come back soon to check for updates, as I will update this Guide as soon as more details about the lawsuit settlement and forgiveness process are released.
Disclaimer:Information obtained from Forget Student Loan Debt is for educational purposes only. You should consult a licensed financial professional before making any financial decisions. This site receives some compensation through affiliate relationships. This site is not endorsed or affiliated with the U.S. Department of Education.