If you borrowed federal loans to attend Heald College between 1995 and its April 2015 closure, Heald College loan forgiveness has most likely already happened for you. In June 2022, the Department of Education approved a blanket discharge covering every federal student loan taken out to attend any Corinthian Colleges campus, Heald included. Roughly 560,000 borrowers had their debt canceled without filing anything. If your loans weren’t part of that automatic action, closed school discharge and borrower defense to repayment remain open to you.
Check Whether Your Loans Were Already Discharged
Log in to StudentAid.gov and look at your loan balances. If the 2022 group discharge reached your account, your Heald-era federal loans should show a zero balance with a discharge notation. The action covered Direct Loans, Federal Family Education Loan (FFEL) Program loans held by the Department, and Perkins Loans. The Department also said it would delete adverse credit history tied to those loans and restore federal student aid eligibility for borrowers whose Corinthian defaults had disqualified them.
If nothing appears to have happened, call your loan servicer and ask whether the Corinthian group discharge was applied to your account. That single call resolves most of the confusion.
Who Still Needs to Take Action
A few situations fall outside the automatic sweep:
- You hold commercially-held FFEL loans that were never transferred to the Department. Borrower defense relief applies to Direct Loans, so these borrowers generally need to consolidate into a federal Direct Consolidation Loan before qualifying.1eCFR. 34 CFR 685.206
- Your Heald enrollment or loans weren’t captured in the Department’s data.
- You enrolled after the April 2015 closure through a teach-out arrangement and didn’t complete it.
Private student loans, including the “Genesis Loans” Corinthian steered many students into, are not covered by the federal discharge. They have their own separate relief track, described below.
Closed School Discharge
Closed school discharge turns on timing. You qualify if you were enrolled at Heald when it closed on April 27, 2015, or if you withdrew no more than 180 calendar days before that date (on or after October 29, 2014).2eCFR. 34 CFR 685.214 – Closed School Discharge The Secretary of Education can extend that 180-day window in exceptional circumstances, and Corinthian’s documented fraud history makes an extension more plausible for borderline cases.
One disqualifier catches people off guard. If you completed your program, or transferred credits to a comparable program at another school, you lose eligibility. “Comparable” is read broadly, and even a handful of transferred credits into a similar program elsewhere can knock you out. Enrolling in a completely unrelated program at another school, without transferring Heald credits, should leave your eligibility intact.
A successful closed school discharge cancels 100 percent of the eligible federal loans and refunds any payments you made on them.3Federal Student Aid. Federal Student Aid Knowledge Center – Closed School Discharge Changes
Some borrowers received closed school discharges automatically. If you were enrolled at Heald on the closure date and never re-enrolled elsewhere within the required period, check your servicer records before filing anything. If the automatic discharge didn’t reach you, submit a closed school discharge application through your federal loan servicer or via the Federal Student Aid website.
Borrower Defense to Repayment
Borrower defense is based on school misconduct rather than closure dates. You argue that Heald’s misrepresentations caused you financial harm because you relied on false information when deciding to enroll and borrow.
For Heald, the Department has already made the misconduct finding. It concluded that the school fabricated job placement rates and misled students about credit transferability, and it fined Corinthian nearly $30 million. Some programs had claimed placement rates as high as 100 percent by excluding most graduates from the calculation; in other cases, Corinthian paid employers to hire graduates for as little as two days just to count them as “placed.” That institutional record does the heavy lifting for individual claims. Your job is to describe your own experience: what Heald told you, how it influenced your decision, and what it cost you financially.
Because Heald closed in 2015, nearly all Heald loans were disbursed before July 1, 2017, and are evaluated under the law of the state where the school operated, typically California for Heald’s campuses.1eCFR. 34 CFR 685.206
Sweet v. McMahon: Applications From 2022
A class action, originally filed as Sweet v. Cardona and now known as Sweet v. McMahon, created binding deadlines for the Department of Education to process borrower defense claims. The settlement, approved in November 2022, listed Corinthian schools including Heald on its Exhibit C, entitling borrowers associated with those schools to full relief.4Federal Student Aid. Sweet v. McMahon Settlement
Post-class applications submitted between June 23, 2022, and November 15, 2022, had to be decided by January 28, 2026. Any application not decided by that deadline triggers automatic full settlement relief: complete loan forgiveness, refunds of past payments, and corrected credit reporting. The Department twice asked the court to extend the deadline, and the court denied both requests.5Project on Predatory Student Lending. Statement on Sweet v. McMahon Court Filing
If you filed a borrower defense application in that June-to-November 2022 window and haven’t received a decision, you should be entitled to full relief. Contact your loan servicer or check the quarterly updates on the Federal Student Aid settlement page.4Federal Student Aid. Sweet v. McMahon Settlement
How to File
For closed school discharge, submit the application directly to your federal loan servicer. For borrower defense, use the application at StudentAid.gov/borrower-defense, online or by mail.
A strong borrower defense application includes specifics. Write down the promises recruiters made about job placement, salary expectations, or credit transfer. Explain how those turned out to be false and how they affected your finances. Attach whatever documents you still have: enrollment agreements, marketing materials, emails, financial aid paperwork. The Department already has extensive findings against Heald, so your account doesn’t have to prove the fraud from scratch. It has to connect your experience to it.
Once you’ve submitted, the Department generally places the associated loans into forbearance. Monthly payments pause and collection activity on any defaulted loans stops while the claim is under review. You’ll eventually get a written determination approving or denying the discharge.
If the Department Denies Your Claim
Federal regulations let you request reconsideration within 90 days of a written denial. There are three permitted grounds: an administrative or technical error, consideration under an applicable state law standard (for loans disbursed before July 1, 2017), or new evidence not previously provided and not addressed in the denial.6eCFR. 34 CFR 685.407 – Reconsideration
The request has to be on a Department-approved form and signed under penalty of perjury, with supporting documentation. If your original application was thin on personal details, reconsideration is your chance to fix that. Gather more records, be specific about what you were told and when, and directly address whatever the Department flagged.
Genesis Private Loans
Corinthian pushed many students into high-cost private loans branded as Genesis Loans. These are not eligible for any federal discharge. A separate Consumer Financial Protection Bureau agreement secured roughly $480 million in relief for Genesis borrowers, delivered as an automatic 40 percent reduction in outstanding balances.7Consumer Financial Protection Bureau. CFPB Secures $480 Million in Debt Relief for Current and Former Corinthian Students
If you had Genesis loans and never got notice of that reduction, contact the current holder. The debt may have changed hands since Corinthian’s closure, so you may need to track down whichever servicer now manages the account.
Refunds, Credit Corrections, and Pell Grant Restoration
A Heald discharge is more than a zeroed balance.
Refunds of Payments You Made
Borrowers who made payments on discharged Direct Loans or Department-held FFEL loans are entitled to refunds of those payments. Refunds tied to the 2022 group discharge were supposed to be processed automatically. If you paid on Heald loans and haven’t seen a refund, call your servicer. Under Sweet v. McMahon, full settlement relief also includes refunds, and court filings indicate relief should be delivered within one year of an eligibility notice.
Credit Report Cleanup
The Department said it would delete adverse credit history tied to discharged Corinthian loans. Late payments, defaults, and collection records associated with your Heald loans should come off your credit report. If negative entries linked to discharged Heald loans still appear, dispute them with the credit bureaus and reference the discharge determination.
Pell Grant Eligibility
Pell Grants have a lifetime cap, and the semesters you spent at Heald counted against it. After an eligible loan discharge, the Department restores your Pell Grant Lifetime Eligibility Used (LEU) for the award years tied to the discharged school. The process runs automatically in batches once the Department has verified both the loan discharge and a matching Pell award at the same school for the same year.8Federal Student Aid. Guidance on COD Processing of Pell Grant Restoration for Eligible Loan Discharges If you’re planning to go back to school and a financial aid office tells you you’ve used too much Pell eligibility, ask them to confirm that your LEU has been adjusted for the Heald discharge.
Taxes on the Discharge
The American Rescue Plan Act made student loan forgiveness tax-free at the federal level, and that provision expired on December 31, 2025.9Taxpayer Advocate Service. What to Know about Student Loan Forgiveness and Your Taxes Starting in 2026, some kinds of discharged student debt are again treated as taxable income.
Heald borrowers have less to worry about here than most. Closed school discharge and borrower defense to repayment have their own federal tax exclusions that predate the ARP and remain in effect. Those discharges are generally not treated as taxable income federally regardless of when they’re processed. The taxability question mainly affects income-driven repayment forgiveness, not fraud-based or closure-based discharges.
State tax treatment varies. Some states follow the federal exclusions, others may not. If you received a large discharge in 2026 or later, check with a tax professional in your state.