ITT Technical Institutes is one of those colleges that you seem to see more on TV commercials than anywhere else. It announced that it is shutting down immediately, blaming the government.
Unfortunately, the reality is that this was a long time coming. For years, many of the so-called, “for profit” colleges have been accused to providing their students little more than a big balance of student loans and degrees that weren’t worth the paper they were printed on. Somewhere along the line, enough powerful politicians switched from protecting these colleges to protecting their students, and the die was cast.
As soon as ITT’s accrediting agency raised questions, the Feds acted.
How ITT Shut Down
Despite what you may read, the government did not shut down ITT. That would be an overstep over government power. Instead, it did the one thing it is allowed to do. It removed the eligibility of students to use federally backed student loans, which, are most student loans, at ITT schools.
Lower income students make up a lot of the student body at schools like ITT Technical Institute. Without loans they wouldn’t be able to pay tuition, and without federal backing, they aren’t going to qualify for those loans on their own. The end result is no new students.
Technically, the government allowed students who were already enrolled at ITT Tech to continue using student loans, but no new students were allowed to start using student loans.
What Now ITT Shutdown?
What to do now is a tricky question.
You may be able to have your federal student loans discharged, but only if you don’t transfer your credits. The idea is that if you get value from the loans you took, in the form of transferable credits, then, you can’t have your cake and eat it too, by having your student loans forgiven. The sticky part here is that even if only some of your credits transfer, that may make you ineligible for student loan forgiveness.
If you can find a school that will transfer your credits from ITT, you can enroll there and take at least some of your progress with you. The catch is that a lot of what ITT offered wasn’t really equivalent to the kinds of courses required at other schools, so some of the credits may not transfer at all. Straight classes like math and science are the most likely to transfer.
So, what should you do?
First, if you want to transfer your credits, figure out WHERE you want to transfer them to, and talk to someone there to find out EXACTLY what will transfer and how. Remember transferring “general credits” might reduce the number of overall class you have to take, but it won’t help with specific class requirements required to get a degree.
Once you know how you credits will transfer, it’s time for a cost benefit analysis. Which is more valuable to you? The transferred credits, or having your student loans wiped out?
If you are not planning on going on to graduate elsewhere, the answer is a no brainer. Without a degree, the credits are nothing. Get your student loans discharged.
If you are planning on going on to get a degree, then you have to decide which is more valuable, taking the credits with you, or getting your forgiven. The closer you are to graduating, and by that, I mean the closer you are to graduating at your NEW SCHOOL, the better it is to take the credits. If you are still going to have to do 3 years at the new school to graduate, then you are probably better off erasing your student loans and starting over.
Finally, there is an option to transfer your credits, and have your loans forgiven, but you’ll need to double check everything first.
I transferred credits from a closed school and enrolled in a completely different program of study at a new school and completed the new program. Are the previous loans from the closed school dischargeable?
Yes, because the program of study at the new school is completely different than that of the closed school, for which the loans were intended
The most important thing is to examine all of your options fully, and most importantly, don’t do nothing. If you aren’t going to continue with school, get your loans discharged. If you are, evaluate your options closely.