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Former ITT Technical Institute Students Granted $500M In Loan Forgiveness

By Eric Weddle

Posted June 16, 2021

The ITT Technical Institute campus in Canton, Michigan.

The ITT Technical Institute campus in Canton, Michigan. (Dwight Burdette/Wikimedia Commons)

Around 18,000 former students of closed college ITT Technical Institute will no longer need to repay federal loans totaling $500 million. The U.S. Department of Education announced Wednesday the borrowers will receive 100 percent loan cancellation.

ITT Tech filed for bankruptcy and closed its campuses in 2016 following a series of sanctions by the Obama administration. The college chain's parent company, ITT Educational Services Inc., was based in Carmel. Campuses in the state included Indianapolis, Fort Wayne and South Bend.

Education Secretary Miguel Cardona said the former students will get a new start after the for-profit college deceived them.

“Our action today will give thousands of borrowers a fresh start and the relief they deserve after ITT repeatedly lied to them,” Cardona said in a statement. “This work also emphasizes the need for ongoing accountability so that institutions will never be able to commit this kind of widespread deception again.”

The announcement follows changes to how loan forgiveness worked under former Education Secretary Betsy DeVos. In March, the Biden administration threw out a formula that offered borrowers partial loan relief if they were defrauded by for-college and private colleges.

The loan relief for borrowers who attended ITT fall into two claim categories: employment prospects and the ability to transfer credits.

The U.S. Department of Education found ITT made misrepresentations between 2005 and the institution’s closure in 2016 to students about how much they could earn and what jobs they could get after graduation.

The department also found the college misled students on whether they could transfer their ITT credits to other colleges or universities from January 2007 through October 2014.

Borrowers who qualify for the loan relief will be notified in the coming weeks.

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