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Students of Failed Law School Can Get Loans Discharged

By William Vogeler, Esq. on March 13, 2018 | Last updated on March 21, 2019

For lucky and unlucky students of the defunct Charlotte School of Law, the government giveth and it taketh away.

Under a new program, former Charlotte students may have their federal student loans forgiven if they were enrolled after Dec. 30, 2016. That was about two weeks after the education department took away federal student loans from the school.

The "closed-school discharge" is good news for about 300 lucky students who will not have to pay back those loans. For the rest who left the school burdened with debt, not so much.

Starving Students

The situation at the law school was bad long before it closed last year. How bad was it? It was so bad they held a food drive for students when the federal funding ran out.

"How can we study when we have headaches because we can't afford to eat?" asked student Margaret Kocaj at the time. "This is our reality now. There are no words."

Under the forgiveness program, qualifying students survived between then and the bitter end. That came on August 17, 2017; however, the funeral march had started long ago.

The American Bar Association signaled it would suspend Charlotte's accreditation in October 2016, but only after widespread reports about the school's failing standards. The Atlantic branded it part of the "law school scam," a cut at for-profit law schools that did little to prepare students for law practice.

"Law School Scam"

Charlotte began operations in 2005, and rose to become the largest law school in the state. Nearly 1,500 students were enrolled in 2013.

Few knew the problems then would soon end the law school leave the students with unpayable debt. State Bar records showed barely half of the graduates passed the bar, and employment data was even worse.

Before authorities closed in, the law school received about $50 million through the student loan program in 2015-2016.

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