Loan Cancellation

Federal Student Loans Have Built-In Protection Against Things Like Fraud, School Closings, Permanent Disability and Death

Learn about who to contact, the types of loan cancellation, eligibility requirements and applicable forms.

• Who Should I Contact about Loan Cancellation?

  Please first read the eligibility requirements to determine if you meet the requirements, as the rules are fairly detailed and specific. If you feel you qualify, contact us to discuss your eligibility or find the loan cancellation option below that fits your circumstance, download and complete the appropriate form and send it to:

  ECMC
  P.O. Box 16408
  St. Paul, MN 55116-0408
  855-810-4920

  If you don't know who your loan holder(s) is, go to the Federal Student Aid (FSA) website, which is the central database for all federal student loan information.

• False Certification: Cancellation Due to Fraudulent Activity

  False certification cancels any loan that was fraudulently originated by the school. False certification applies to loans disbursed after January 1, 1986, and is tightly defined to cover the following specific situations:

  Ability to Benefit
  Every school must certify students are eligible for federal student loans. For students without a high school diploma or GED, this means the school must demonstrate the student is academically able to benefit from the school's programs before the student can take out a loan(s). If a school falsely certified you for a program for which you did not qualify, you may be eligible for loan cancellation.

  Ability to benefit cancellation only applies to fraudulent certification. It does not apply to schools that misrepresent their education programs, the quality of their facilities and faculty, or their ability to help you find employment in your field of study.
  
  Loan Discharge Application: False Certification - Ability To Benefit (PDF)

  Unauthorized Signature
  In rare cases, someone at the school has signed a borrower's name on a financial aid application without authorization, received the borrower's loan funds and the borrower received no benefit from those funds. If you believe an official at your school forged your signature on a promissory note or loan application, you may be eligible for loan cancellation.
  
  Loan Discharge Application: False Certification - Unauthorized Signature/Payment (PDF)

  Disqualifying Status
  If your school certified your eligibility to study for a field in which you could not work, you may be entitled to loan cancellation. Barriers can include physical or mental conditions, legal status or other conditions that would legally bar employment in your field of study. An example of this may be a school knowingly admitting a felon into law school.
  
  Loan Discharge Application: False Certification - Disqualifying Status (PDF)

• Closed Schools: Cancellation Due to a School Closing

  If your school closed while you were enrolled and before you completed your program, you may be eligible for loan cancellation. The U.S. Department of EducationU.S. Department of Education (ED)A federal agency that administers most federal programs concerning education, including the Federal Family Education Loan (FFEL) and Direct Loan Programs. has an online closed school search page where you can confirm your school closed. Closed school cancellation applies to loans disbursed after January 1, 1986, and covers these specific situations:

  • You did not complete the program through a teach-outTeach-outAn agreement established between institutions (schools) of higher education to provide fair treatment to students whose academic program at their current institution is discontinued before all the students enrolled in that program have had a chance to complete it. at another school
  • You could not transfer academic credits or hours from the closed school to another school
  • The school closed while you were enrolled
  • The school closed within 120 days of an approved leave of absence or withdrawal

  You can find out more on the U.S. Department of Education's Closed School Information section of the website .

  Loan Discharge Application: School Closure (PDF)

• Unpaid Refund: Cancellation Due to a School Not Refunding an Unused Portion of Your Loan(s)

  If you attended school for less than 60 percent of the loan period, you may be due a refund. If your school should have refunded a portion of your loan(s) to your loan holder(s)Loan holderThe institution that holds the title to a loan and therefore has a right to collect on that loan. The holder of Federal Family Education Loan Program (FFELP) loans may be a lender, a guaranty agency, or the federal government. The holder of Perkins loans may be a school or the federal government. The holder of Federal Direct Loan Program loans is the federal government. and didn't, the amount of the refund plus any accrued interestAccrued interestInterest on the loan that has accumulated since disbursement or the last payment made. related to the refund amount can be canceled.

  If your school is still open, contact your school to discuss the situation. If your school is no longer open, contact your loan holder(s) to discuss your options.

  Loan Discharge Application: Unpaid Refund (PDF)

• Total and Permanent Disability, Including Veterans

  If you become totally and permanently disabled, your student loan(s) may be canceled. To qualify, you must have a physician (doctor of medicine or osteopathy) certify that you are totally and permanently disabled.

  According to the U.S. Department of Education's website, totally and permanently disabled is defined as the condition of an individual who:

  1. Is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that:
     • Can be expected to result in death;
     • Has lasted for a continuous period of not less than 60 months; or
     • Can be expected to last for a continuous period of not less than 60 months; or
  2. Has been determined by the secretary of veterans affairs to be unemployable due to a service-connected disability; or
  3. If you are receiving Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI) benefits, you can submit a Social Security Administration (SSA) notice of award for SSDI or SSI benefits stating that your next scheduled disability review will be within five to seven years from the date of your most recent SSA disability determination.

  "Substantial gainful activity" is defined for purposes of this discharge as a level of work performed for pay or profit that involves doing significant physical or mental activities, or both.

  Visit the U.S. Department of Education's website at www.disabilitydischarge.com for more information or to apply for loan cancellation due to total and permanent disability.

• Death

  Upon death, a borrower's remaining student loans are canceled and no future payments are necessary. The same applies for a PLUS loanPLUS loanA PLUS Loan is a student loan offered to parents of dependent students enrolled at least half-time in eligible programs at participating and eligible postsecondary institutions or graduate and professional students at participating and eligible postsecondary institutions. upon the death of a student. To validate the death of a borrower or student, an original death certificate, a certified copy, or a clear, accurate and complete photocopy are required.

• Spouses and Parents of September 11, 2001 Victims

  This loan cancellation is for survivors and of the September 11, 2001, terrorist attacks.

  Loan Discharge Application: Spouses and Parents of September 11, 2001 Victims (PDF)