Let’s start with the important part of this article: There is no good way to dodge a student loan. You can’t return your education because you’re unhappy with your school or struggling to find a job in your field. People have tried, have sued, and have gone even further into debt trying to argue their case. There is no warranty or guarantee of value on your college education.
Yeah, that’s bad news. Sorry.
But there are a few scenarios where the school is so in the wrong that they do have to put their wallet where their mouth is–mainly if the school’s fault is not with their teachers, but with their accountants. If the school failed at their due diligence in giving you a federal loan in the first place, they might have to just eat it. These are the three most common examples.
- If you don’t have a high school diploma or equivalent. Federal loans nearly always require a diploma, a G.E.D., or the like. If you didn’t have one at the time of your loan being granted and the school didn’t check, those loans may be void.
- If you weren’t able to benefit from your education from the moment you began. For instance, if the school approves a loan for a legally blind person to take truck driving, or a student with a felony record to study law enforcement or education. If you can prove that you legally (NOT situationally) could never have benefited from the education for which the loans were made, you might be off the hook.
- If you’re not the one who applied in the first place. Identity theft. This one is maybe the most obvious – you never applied those loans, you never got the money. (That part’s important. Even if your parents fraudulently applied for the loan for you, if they then spent money on your education or upkeep, you got that money, and this example does not apply to you.)
In all of these criteria, the point is that you legally did not benefit from the loans. Either you aren’t eligible for your degree/certification by law or the institution’s own rules, or you were straight-up robbed. Each of these will require you to pursue legal action as well. None of them are a way out for the average student, only for those seriously wronged by the loan application process.