Increased Oversight of ITT and the Impact on Students

In recent years, ITT Educational Services, Inc. (ITT) has increasingly been the subject of state and federal investigations and this year it has twice been found out of compliance with its accreditor’s standards. Over time, ITT’s decisions have put its students and millions of dollars in taxpayer funded federal student aid at risk. In response, over the last couple of years, we at the Department of Education have increased our financial oversight over ITT and required the school to boost its cash reserves to cover potential damages to taxpayers and students.

These investigations are still ongoing and last week ITT still failed to address its accreditor’s concerns. In response, today we’re announcing further federal action: To protect prospective students and taxpayers, we’re no longer allowing ITT to enroll new students with federal aid. In addition, in case the school’s actions cause it to close, we’re increasing the amount of cash reserves it must send us and we’re ending its installment payment plan for the amount previously required. Finally, we’re slowing down when ITT receives student aid from the government to ensure that ITT is handling its finances properly.

As a current ITT student with federal loans, you have some options:

  1. You can continue your courses at ITT with your federal student aid. There’s no immediate change to your program.
  2. You can transfer your credits to a new school (if that school accepts them) and complete your education.
  3. You can pause your education and wait to see how this matter resolves itself in the coming months. If ITT closes before you finish your program and you don’t transfer your credits, you will likely be eligible to discharge your federal loans.

I imagine you have some questions. Let me try to answer a few of them for you.

I’m close to graduating. Can I finish my degree?

Yes, unless ITT chooses to close instead of continuing to teach students. If you’ve already started classes at ITT, you can continue using federal aid there as long as the school remains open. New students will not be able to use federal student aid for classes at ITT.

If ITT eventually closes, will I still have to repay my federal student loans?

If ITT closes you may be eligible for a closed school loan discharge. If we reach that point we’ll share information on that process as you consider your options through the Federal Student Aid’s announcement page.

I just recently enrolled at ITT, but I haven’t started classes yet. Can I still use federal aid?

No. If you are a new student who has never been enrolled at ITT in a previous semester, you cannot start classes at ITT in the fall semester of 2016 using federal student aid. I know this is probably a major disappointment and inconvenience, but it’s too risky. You should still pursue a higher education. You might want to use our College Scorecard to explore your options and find the program that’s right for you.

Will this impact my GI Bill benefits?

No. The U.S. Department of Veterans Affairs (VA) will notify affected GI Bill students that, at this point, the Department’s actions do not directly affect their GI Bill benefits. These actions, however, do raise significant concerns about ITT’s financial viability. Current GI Bill students at ITT should carefully consider the potential impact that the Department’s actions may have on their educational goals.

If you are a GI Bill student and have questions about your GI Bill benefits, please contact the VA’s Education Call Center at 1-888-442-4551 or visit the GI Bill website. If you are eligible for the GI Bill and want to explore your education options, you can use the GI Bill Comparison Tool to find the program that’s right for you.

I already completed my degree at ITT. Is it worthless?

No. You completed your degree at an operational and accredited institution. Nobody can take away your credentials or the skills you gained.

I already completed my ITT program but I feel like I was defrauded. Can I get my money back?

The actions we’re taking against ITT today are based on the operational and financial risk they pose to students and taxpayers, not on a finding that they defrauded students. There are, however, a number of open federal and state investigations into ITT campuses. If those investigations find evidence of fraud or other illegal behavior surrounding your specific program, you might be eligible for relief.   You can also go to Federal Student Aid’s borrower defense page to learn more about how to file a claim if you believe the school misled you.

I’m nervous that ITT may close and I don’t want to start over. Should I transfer my credits?

That’s an option. It’s a choice that only you can make and one that you should consider carefully. Each student’s circumstances will be unique.

Here are a few key things to consider:

  1. Whether your credits transfer will be up to the new school. It’s likely to vary based on the type of program and school you’re considering.
  2. If you transfer your credits, you may not be eligible to have some or all of your federal loans discharged if ITT ultimately closes.
  3. Before you transfer, ask yourself: Is the type of program I’ve started still the right one for me? Will finishing it open up the career opportunities I want? You may want to check out our College Scorecard as you think about the answers to those questions.

Where can I go to get updates on what’s happening with my school? What’s the most reliable place for information?

Your school should update you directly. We’ll also post updates if there are major changes on Federal Student Aid’s announcement page.

Ted Mitchell is U.S. Under Secretary of Education.

241 Comments

  1. I got a degree from ITT-Tech December 2011 and I want to know if I can get loan forgiveness too. My friend and I finished but we could not find a job so we kept out direct care jobs that we had just to eat and put gas in our cars. When I first started the lady in the financial aid office could not tell me how much I was going to get in grants when I asked her. Right now I have to pay back all this hugh sums of money, right not in total is close to to 60,000.00. I been so mad at myself for got to ITT. I need help too if anyone have idea about my problem. Thanks.

  2. I received my degree from ITT in 2008. As an older student who did not want to be saddled with student loans I cashed in my retirement and paid my whole tuition in cash. At the time I attended ITT per diem teachers were brought in who taught us nothing and in order to hide that fact many of us were given the answers to exams just so we could get A’s. I myself walked out of a teachers class after three weeks because the only thing I learned was how many degrees he had and how great he was. I ended up paying extra and graduated a semester late due to this action. I never ended up finding a job that paid what I should have earned based on the cost of my education. Now, at the age of 63 I am unable to work, my income is below the national poverty level and I have no retirement to supplement my Social Security with. I see action being considered on behalf of the students who took out loans to attend ITT but the ones of us who cashed in retirements to fund our education are being left out in the cold. What kind of recourse do we have for getting some of our tuition back or are we just going to be considered collateral damage?

  3. Since this has been happening for years now with ITT and for profit colleges. Who besides the students of the last 120 days are qualified for student loan forgiveness or dismissal . I attended ITT back in 2006 and I was lied too about many important details and the courses I would be taking and many other things that I do not want to mention at this time . What happens to us ? Those of us Who experienced the same type of fraud that the 2016 students experienced?I do understand the difference that they have been totally left out in the cold. I do see the difference but the same thing was happening when I attended with deseption . The only difference is that the school didn’t close and leave the students hanging out to dry.

  4. I am very hurt by the clossibg5of ITT. I was a 49 year old student that was on the dean’s list and honor roll. I just joined nhs. The closing of the school really hurt n now I don’t won’t to finish my courses. I was almost done. I feel led on by the school and I think action should be taken against the school.

  5. Department of Ed, why aren’t you letting my comments go through?

    Here’s the scoop for those of us that attended and got our degree from this worthless college: We’re stuck paying our loans, because clearly we weren’t in the same state as all of the people who were students after we got our degrees. I don’t agree with that logic, as our degrees are pretty much worthless now, so why should those of us that got the degree still pay for it?

    Also, the only way it looks like we will get any sort of relief is to prove that ITT-Tech committed fraud, hope that there’s a class action lawsuit that covers us, or write to your congressmen and congresswomen to change the law.

  6. I finished my last final of the program the Monday before the closing of the school. So that means that all of my course work is finished. I am just very confused on how I will be receiving my diploma. And upset because there aren’t many answers for this. Seeking information on diploma

  7. I finished 2 quarters of my bachelors in Project management and need to find a school in the Indianapolis area that excepts IIT Tech credits and is a traditional on campus school. I work full time and can only go to school at night and will be utilizing my post 911 GI bill. I really do not want to loose the credits I have earned since I will more than likely not get the time back on my GI Bill. Any suggestions would be great I have looked at so many schools and all I see being offered is online. Seeking assistance..

  8. What I see is the DOE running a money hungry grab. I am an ITT student feeling the repercussion of the green eyed monster (James King Jr.). I have two options: 1. Take loan forgiveness, which means I lose the $12000 in grants I earned. If i attend a new school, I will be essentially paying back the grants as I cannot use them now to the DOE through a new student loan. 2. Transfer what few credits will to a new college. That means I am stuck paying for useless credits. So the DOE benefits from that. My question is, how are the students interest a high priority? Seems to me James King bullied a school he couldn’t control, except through financial aid, shut them down, and gained money from students, taxpayers, and probably a fat check from some non profit organizations. I feel a class action lawsuit should be placed against the DOE, and an investigation against James King Jr. I am sure he’s received some private donations or admittance of some family members for free rides to some prestigious schools.

Comments are closed.