Your College Debt May Be Forgiven If You Attended This College

Posted by CapWay in Student LoansDecember 17, 2019(Last Updated December 4, 2021)2 min read
Key Takeaways
  • University of Phoenix was required to cancel $141 million of student balances owed directly to the school. 
  • The debt forgiveness from the University of Phoenix does not apply to federal or private student loans.
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The Federal Trade Commission (FTC), an agency that protects consumers, has successfully filed a complaint against the once-popular University of Phoenix. According to the FTC, the for-profit school targeted "military and Hispanic consumers" and promised job placement opportunities with major corporations that did not exist. 

The University of Phoenix and its parent company, Apollo Education Group, have reached a settlement with the FTC to pay $191 million to fix the damage caused by untrue marketing about their programs. 

Image credit: Eric Glenn /

Part of this settlement includes the University of Phoenix canceling $141 million of student balances owed directly to the school. Students may be eligible for debt cancellation if they meet the following criteria:

  • The debt was owed directly to the University of Phoenix.
  • The student was enrolled at the school between October 2012 through December 31, 2016. 
  • The debt is not a federal or private student loan.

Students eligible for forgiveness should receive letters from the University of Phoenix confirming that their balances are forgiven. The University of Phoenix must also request that the forgiven debt balances be deleted from the students’ credit reports. The school must also allow students to request their transcripts and diplomas. 

Unfortunately, the debt forgiveness from the University of Phoenix does not apply to federal or private student loans. However, students with federal loans may apply for loan forgiveness through the Borrower Defense to Loan Repayment. This special type of loan forgiveness is for borrowers whose schools deceived them or engaged in misconduct. Students may qualify for forgiveness of some or all of the federal loan balance for attending those schools. 

If you are attending a college and want to be sure that the school is reputable, then the FTC recommends you research the school using the following two guidelines: 

1) Searching them on the U.S. Department of Education’s College Navigator site. There, you can find out if your school is private, public, or for-profit. You can also confirm that the college is accredited, and you can see how many students and graduates fall behind on their student loans. 

2) You can also check out personal stories from former students of the school by searching on platforms like Google or Twitter for the school's name, followed by keywords like "fraud," "complaint," and "scam."

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