Closed Universities

University of Phoenix Student Loan Forgiveness Guide 2022

Table of Contents

On December 10, 2019, FTC announced the settlement with the University of Phoenix. They stated that parties agreed on a 191 million dollar benefit for former students of the university. As part of that agreement, students owing directly to the university would get 141 million loan forgiveness. To qualify for the University of Phoenix loan discharge, students should have attended the school between October 2012 and December 2016. Apollo Education Group mentioned on a variety of occasions that students can relax because, within 45 working days, all the debt amount of eligible students will be cleared. 

Why There was a Need for the University of Phoenix Loan Forgiveness

Background of the UOP

The University of Phoenix is a for-profit school that used tactics to attract middle-class students by ensuring that they will get a high degree and find quality jobs. Not only the students but also veterans have been influenced by this university while attempting to get a degree.

UOP Class Action Lawsuit

In multiple states such as Arizona, Arkansan, and California, the UOP faced many lawsuits regarding the case. Since 2014 the university tries to fight back claimed violated rules in many phases. The court sued UOP for:

  • Interference with Contractual Relations of students
  • Unjust enrichment
  • Conversion
  • Breach of:
  • Implied Covenant of Good Faith
  • Contract
  • And Fair Dealing

Allegations against the UoP

There are specific claims against the university, which are completely unethical and unacceptable. For instance, students argue that the University of Phoenix hired trained enrollment counselors. Another scandalous allegation about the university came from former employees who were whistleblowers of federal funds’ waste.

Possibilities of Your Student Loan Getting Discharged

university of phoenix loan discharge

The Department of Education states on its website that under particular circumstances, DOE is ready to forgive or cancel student loans. Those circumstances may include the closure of the university or fraudulent actions that might be used by the university etc. Respectively, in the first case, you would apply for student loan forgiveness programs. On the other hand, for acquiring the University of Phoenix loan discharge, students need to prove that the school did those fraudulent acts against them.

In cases when the school is falsely certified, there is a chance for loan discharge. However, the concern by students shows that DOE is not so active about loan discharge. In fact, some of those students think that the eligibility criteria and the harshness of the whole process are a plan that can push back a student from getting his/her loan discharged. Let’s first analyze the closed school discharge option. Then, we can go through BDAR claims that can help you to get debt relief through the University of Phoenix Loan Discharge Program.

Closed School Loan Discharge

For those of you who attended a school while it closed, there is a chance to discharge the loan that you took for studying at that university. This program can help students with federal Family education Loans, Direct Loans, Perkins Loans, and so on. You can be eligible to apply for this program if

  • You were studying at that time when the school got closed
  • The student transferred his/her credits to another school but a similar program. For instance, if you were studying criminal justice in UOP and moved to the same or slightly different program such as Criminal Law etc.
  • You were attending UOP 120 days until or after June 20, 2014. There is a chance to get approval from those of you who withdrew from classes during this time.  

How to Get Your Loan Discharged?

Under the settlement provisions, the University of Phoenix agreed to pay 191 million dollars for student loan forgiveness. This settlement was mainly focusing on loans that students owe to the UOP directly. For federal student loans, there is a chance for students through BDAR, which we will discuss next.

Using BDAR for Discharging the UOP Loans

Under the Borrower’s Defense law, it is mentioned that in cases where the opposing side (university) did fraudulent things against the student, students have the right to use loan discharge. Violation of the rules, misinterpretation or misconduct, are all part of those fraudulent acts. In our case, which is based on the University of Phoenix, students have the right to file the BDAR claim and earn loan discharge. As the university provided private student loans to those students while assuring them that the higher education programs them are best, it is perfectly fine to note all those aspects in your BDAR application.

You generally need to accuse the UOP of false advertising and misleading claims that led you to take the loan in the first place or prove that they lied about:

job placement rates

graduation rates

and many more statistical measures. 

If you face such an incident and want to get rid of the massive loan debt, all you need to do is write a BDAR application and submit it to related institutions. The good news for former students of UOP is that if DOE approves their request, they get a complete loan discharge. 

How to Effectively Support Your Claims in the BDAR Application?

While you write your BDAR application, there are specific issues that you need to address. You need to clearly state that you only took the loan to attend the University of Phoenix. By doing so, the primary reason for your decision was mainly because the university misled you with their fraudulent marketing activities. In other words, conclude that you would never choose that university unless they made those falsified claims. You can show the instances where they

  • tricked you
  • lied about their curriculum
  • mislead you with their false facts about success rates, etc. 

Keep an eye on this part because if you cannot manage to fully cover the issue in detail, your BDAR application will not be approved by the Department of Education.

They are selective about the case. As we already mentioned, the strict evaluation rules that DOE put on this matter make it a little tougher for students to get approval. You need to deliver the right message throughout your claim and support those arguments with evidence. You can attach a screenshot of the messages or call recordings, if possible. In a class-action lawsuit, officials accused UOP of various illegal acts, and you can analyze them to see whether or not any of them happened to you. In the next paragraph, we will explore those claims so that you can better understand and write a practical application that can help you get the University of Phoenix loan discharge. 

How was the University of Phoenix involved in those actions?

Student Loan Consolidation

As you already know, UOP was accused of doing illegal stuff that caused students to raise their voices and ask for justice. Besides, students who want to get a higher degree start searching for available universities for their budget. They look at the current standing, prospect, graduation, and job placement rates whenever they analyze the options. It is impossible to choose the best option without comparing the results of these matters. So, the former students of Phoenix University found out that the university is a very prestigious place that can ultimately open up a successful career path.

After all these years, the FTC raised claims that the university was lying about all that statistics and inflating rates to attract more students. Would you spend thousands of dollars or take a huge loan just because of attending a school where only 1 of 5 students graduate? The answer is no. In your BDAR claim, try to explain this matter clearly so that your chances of acquiring student loan discharge from the Phoenix university increase. 

Where do you need to submit the BDAR Claim?

The United States Government has a special website for these types of procedures. By logging into your account, you can easily submit the BDAR application. Keep in mind that it is a sensitive issue. You should never trust any third-party individuals or companies when it comes to providing the BDAR application. You can still consult related agencies and people who had such experience to file an effective claim. Student loan scams can take advantage of you and sell your documents and private information to other companies. That is why be careful about whom you are consulting while filing your application form.

How long will it take for the Department of Education to post the status of the BDAR application?

This question does not have a specific answer because it can take several weeks or even months to get a piece of information about the status of your BDAR claim. If you want to get the University of Phoenix Loan discharge, do not lose much time. Start writing and submit your applications to the official website as soon as possible. 

Taxes and Annual Student Loan Payment

Some students think that after applying, they can stop paying for loan debt. However, this is not the case. You need to follow the contractual guidelines and pay for the loans annually. After you get a message about approval, you can stop paying. The approval message means that Phoenix University discharges all the debt amount. Until then, do not risk your chances because you might pay additional fees and the student loan interest rates for the period that you missed your payment. 

Will there be taxes for your discharged student loan debt?

While the student utilizes Borrower’s Defense Discharges to apply for the University of Phoenix loan discharge program, there will be taxes on your deleted balance. It is one of the significant downsides of this program, but unfortunately, students have to pay taxes for it. The forgiven or discharged amount is considered as income in students’ balance. The IRS (Internal Revenue Service) will take money from you in the form of taxes according to the amount that has been discharged.

You may see this issue unfair, but it is obligatory. The IRS treats the discharged loan as an income, but few exceptions can relieve students from tax amounts. So, let’s understand the process and then show you why the University of Phoenix Loan Discharge program can be useful in terms of taxes.

Loan Discharge and Taxes: Are there any exceptions?

The IRC will send you Form 1099-C as soon as your BDAR application is approved. This form is for specification purposes. You need to fill it unless the amount of forgiven debt is less than 600 dollars. While filling this form, you need to report the forgiven amount in Box number 2 under the headline of other income. For a forgiven debt amount that is less than 600 dollars, students still need to report it on the document as a federal income tax return. 

The good news for students is that the tax debt will be much less than the actual discharged amount. For instance, let’s imagine that you have 10.000 dollars of loan debt, and you discharged it through BDAR. Considering that you are in the 22 percent tax bracket, you will need to pay 2200 dollars to the IRS in the form of income tax. Even better news for students is that some of the discharged loans might not be taxable income.

Who will be able to take advantage of that case?

Specific occupations can help students to eliminate the tax amount on their discharged student loans. What are those occupations?

  • Nurse
  • Doctor
  • Teacher
  • Public Defender
  • Veterinarian
  • Dentist
  • and Prosecutor

The programs that allow students to discharge loans without paying taxes are

  • Teacher Loan Forgiveness
  • PSLF
  • And National Health Service Corp Student Loans

In addition to that, public loans that are funded by the PHS Act are also considered as tax-free income when students successfully utilize loan discharge.

Death and disability discharges or similar accidents can also help the student to avoid paying taxes on their forgiven debt.

The main exception that concerns us is the closed school and false certification discharges. For the University of Phoenix Loan Discharges, it can be applied. Former students of UOP can claim that the university used false certification for the aid program, which can help them avoid the IRS tax.


  1. I need more information on my loan forgiveness I graduated with My Bachelors and never found a job. My Degree has did nothing for me. I went to school thinking this was going to benefit me… I have a paper that is worth the amount of my Loan I will never be able to pay it back , I will probably die with debt of the Loan

    1. I too think I will die with my school debt. The school said you will have no trouble finding a job after you graduate. I have both an AA and a BSHA and nothing. I am working in a job that I am way over qualified for but can’t change it because the jobs are like oh you need a Masters to work in the field of you have to have experience in this field. How can you get experience without someone giving you a job. #Catch22🤯

  2. I was I qualified for complete a scholarship. And was told by administrative personal that the loan that was acruing would be pardoned. At graduation. Boy was I a fool.

  3. I was told that I could get a job with an associate degree. Well, after finishing it, I realized that it was not the case. There was no job for me. I was asked to get a bachelor degree. I started it but it was not going anywhere and I had to quit. I never been able to work. I was charged huge amount of money per classes. Instead of charging per year, they were doing small loans that all had different interest rate and at the end, they were more expensive than a regular loan would be!

  4. I completed my master degree and hoped to be able to proceed to become Cpa certified. Come to find out the college was not accredited. Now I have $100k loan and no job to pay it

  5. I was told by UOP that I could become a licensed therapist with a Masters in Psych. Nope. I need to get a whole new Masters now..

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  7. I received my bachelors in psychology degree so long ago. I struggle to remember the lie I was told.I believe it had to do with the career choices that would be available to me. I just know the degree is not worth the piece of paper it was printed on, and I have massive school debt, and unable to utilize it for employment.

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