If you took out federal student loans to attend a school that lied to you—about job placement rates, whether your credits would transfer, or whether the program was properly accredited—you may not have to keep paying those loans back. This is called borrower defense to repayment, and it’s a legal path built specifically for situations where a school’s misconduct is the reason you’re stuck with debt.
What borrower defense to repayment covers and who qualifies
Borrower defense to repayment is a federal process that allows the Department of Education to discharge some or all of your federal student loans if your school engaged in misconduct connected to those loans. This applies to Direct Loans, and in many cases to loans that were later consolidated into Direct Loans. It does not apply to private student loans, which are governed by different rules and typically require separate legal action.
To qualify, you generally need to show that your school did something wrong—made a false statement, omitted important information, or otherwise misled you—and that this misconduct related directly to your enrollment or to the loans you took out to pay for it. The misconduct has to matter. A minor inaccuracy in a course catalog probably won’t cut it. But a school that promised a specific job outcome it knew wasn’t realistic, or claimed accreditation it didn’t have, is the kind of thing this process is meant to address.
You don’t need to still be enrolled at the school, and the school doesn’t need to still be open. Many borrower defense claims involve schools that have since closed. You also don’t need a lawyer to file, though some borrowers choose to get help, especially for complicated cases.
Common examples of school misrepresentation that lead to approval
Claims tend to fall into a few recurring categories. Understanding these can help you figure out whether your situation fits, and help you gather the right kind of evidence later.
Job placement misrepresentation. This is one of the most common grounds. Schools sometimes advertised job placement rates that were inflated, counted graduates as “placed” if they got any job at all (even unrelated to their field), or simply made up numbers to attract enrollment.
Accreditation misrepresentation. Some schools claimed to be accredited by a recognized body when they weren’t, or claimed a specific programmatic accreditation (often required for licensure in fields like nursing or cosmetology) that didn’t actually exist for that program.
Credit transfer misrepresentation. If a school told you your credits would transfer to another college, or that your program would qualify you for a professional license, and that turned out to be false, this can support a claim.
Misrepresentation about cost or debt. Some schools understated how much students would actually owe, misrepresented the availability of financial aid, or pressured students into loans without clear disclosure of terms.
Misrepresentation about the nature of the education. This includes false claims about faculty qualifications, the availability of equipment or facilities, or whether a program actually prepared students for a specific career.
If your school was later sued or investigated by a state attorney general or found to have violated consumer protection laws, that can strengthen a claim, though you don’t need an official finding against the school to file one yourself.
How to file a claim with the Department of Education and what evidence helps
Claims are filed directly with the Department of Education, not with your loan servicer. The application asks you to describe what happened, identify the school and program, and explain how the misconduct affected your decision to enroll or take out loans.
Before you file, it helps to gather whatever documentation you still have. This might include:
Enrollment agreements or contracts you signed. Marketing materials, brochures, or website pages describing job placement rates or accreditation (screenshots are fine if the school’s site has changed or gone offline). Emails or text messages from admissions or financial aid staff making specific promises. Course catalogs or program descriptions from the time you enrolled. Any records showing what you were told versus what turned out to be true—for example, a rejection letter from a licensing board if you were told your program would qualify you, or documentation that credits didn’t transfer as promised.
You don’t need every category of evidence. Even a clear, detailed written account of what you were told and how it differed from reality can carry weight, especially if your experience matches patterns already documented for that school. It’s worth checking whether the Department has already identified widespread misconduct at your school, since some claims get processed faster when they’re part of a larger group of borrowers with similar stories.
Be specific and factual in your application. Rather than saying the school “lied,” describe exactly what was said, when, by whom if you remember, and what you later learned was different. Specific details are more persuasive than general frustration, even if the frustration is completely justified.
What happens to your loans and credit report while a claim is pending
Filing a borrower defense claim doesn’t automatically pause your payment obligation, but many borrowers with pending claims are placed into an administrative forbearance while the Department reviews the case. During forbearance, you’re not required to make payments, and interest may or may not accrue depending on the type of forbearance applied—this varies, so it’s worth checking your loan servicer’s account portal or contacting them directly to confirm your loan’s current status.
It’s important to actively request or confirm this forbearance rather than assume it happens automatically the moment you submit your application. Contact your loan servicer after filing to ask whether your account has been flagged for a borrower defense-related pause, and get any confirmation in writing or saved in your account messages.
While your claim is pending and forbearance is in place, your loans generally shouldn’t be reported as delinquent, since you’re not required to pay during that period. However, mistakes happen. Check your credit report periodically while your claim is pending to make sure your loan servicer isn’t reporting missed payments incorrectly. If you spot an error, contact your servicer first, and keep records of that communication in case you need to dispute the entry with a credit bureau later.
If your claim is fully or partially approved, the discharged amount is removed from your loan balance, and the Department may also correct related credit reporting and refund payments you made after a certain date, depending on the specifics of your case.
Realistic timelines and what to do if your claim is denied
It’s worth setting realistic expectations here: borrower defense claims can take a long time to resolve. Processing times have varied significantly depending on how many claims are in the queue, whether your school is part of a larger group review, and how complex your individual circumstances are. Some borrowers wait many months; others wait considerably longer. There’s no guaranteed timeline, and checking in periodically with your servicer or the Department is reasonable if you haven’t heard anything after a substantial wait.
While you wait, keep copies of everything you submitted, note the date you filed, and save any confirmation numbers or correspondence. If your contact information changes, update it with both your loan servicer and the Department so you don’t miss important notices.
If your claim is denied, you should receive an explanation of why. Read this carefully, since it often points to what evidence was missing or why the Department didn’t find the misconduct rose to the level required for discharge. In some cases, you may be able to submit additional evidence or request reconsideration. If your claim involved a school that is part of a larger, ongoing group action or investigation, staying informed about that broader case may reveal new evidence or options down the line.
If you’re unsure why your claim was denied or whether you have grounds to challenge the decision, consider reaching out to a legal aid organization in your area or your state’s attorney general’s office, many of which have handled cases involving specific schools and may have insight into what worked for other borrowers in similar situations.
