Art Institute Student Loan Forgiveness: How to Get It

Former Art Institutes students are eligible for Art Institutes Loan Forgiveness under different programs. No matter which campus you attended, you have various paths to consider:

1. Borrower Defense to Repayment: Born from the Sweet v Cardona lawsuit settlement, which wiped out $6 billion of federal student loan debt for borrowers who attended mostly for-profit schools, this might be your choice if you attended the school between 2004 and 2017. Learn More:Art Institutes Borrower Defense
2. Closed School Discharge: If your school folded while you were enrolled or soon after you left, this path is for you. You could see your federal student loans discharged if the closure prevented you from finishing your education.

Furthermore, being a former Art Institutes student, there’s a chance that you might be eligible for these federal student loan forgiveness programs:

• Public Service Loan Forgiveness (PSLF): This program forgives the remaining balance on your Direct Loans after 120 qualifying payments under a qualifying repayment plan while working full-time for a qualifying employer.
• Income-Driven Repayment (IDR) Waiver: Set to kick off in spring 2023, this game-changer offers automatic relief for those who’ve been making federal student loan payments for 20 years or more. IDR bases your payments on your income, not the balance owed, and the coming policy shift could drastically cut your journey to loan forgiveness.

As for any private student loans you have, if you’re still grappling with those, explore refinancing, negotiating a settlement, or considering student loan bankruptcy.

A glance at the journey toward loan forgiveness reveals key milestones:

• 2015 Settlements: Education Management Corp., the former parent company of the Art Institute chain, was hit with a $95 million settlement for fraudulent practices and illegal marketing and enrollment activities. You may see this referred to as the “Art Institute Accreditation Lawsuit.” That same year, an extra $100 million settlement was reached with attorneys general from several states. These actions resulted in significant loan forgiveness for thousands of students nationwide. These settlements might have already benefited you if you attended one of the Art Institute campuses.
• 2022 Navient Settlement: Accused of unfair loan servicing practices, Navient had to pay out $1.85 billion in relief to settle a class action lawsuit filed by dozens of state attorney generals. For many of you, this might have cleared your subprime private student loan balances. Here’s a breakdown of the Navient lawsuit.

Importantly, these settlements and discharges have already been applied.

So if you’re still dealing with student debt from the Art Institute, it might be because you’re awaiting the benefits of a new Borrower Defense application or the automatic forgiveness from the Sweet v Cardona lawsuit.

Who Benefits From the Sweet v Cardona Settlement - Did I Miss Out?

The Sweet v Cardona lawsuit led to the cancellation of $6 billion in federal loans for nearly 200,000 former students, including many former Art Institute students, who submitted borrower defense claims alleging their schools defrauded them before November 15, 2022. If you applied before this time, you will fall into one of the following three categories.

Who Gets Relief Under The Sweet v. Cardona Settlement?

The automatic relief group

If you applied for Borrower Defense loan forgiveness on or before June 22, 2022, and were in a school from this list then you should have received full relief on or before January 28, 2024. Notably, this settlement overturned 128,000 denial notices issued when the Trump administration oversaw the Borrower Defense process.

The decision group

This group is pretty complicated. If your Borrower Defense loan forgiveness application was denied between December 2019 and October 2020 then you should have received a notice reopening your application by May 28, 2023. Otherwise, your decision date is based on your application year.

• Applications received by the end of 2017 will be decided by July 28, 2023
• Applications received during 2018 will be decided by January 28, 2024
• Applications received during 2019 will be decided by July 28, 2024
• Applications received during 2020 will be decided by January 28, 2025
• Applications received from 2021 – June 22, 2022 will be decided by July 28, 2025

The past class applicants

If you applied between June 22 and November 16, 2022, you’ll receive a decision within three years and full relief if the department misses that deadline. Notifications for eligible borrowers started in late April 2023. Further information is available on StudentAid.gov and through The Project on Predatory Student Lending (PPSL).

If you haven’t received an update by the dates above regarding your borrower defense repayment forgiveness or refund then fill out the PPSL’s Lack of Notice survey so that they can advocate for you or feel free to book a call with me so we can review your situation.

If you didn’t apply on or before November 15, 2022, even though you won’t be considered in the settlement you can still apply for Borrower Defense!