There are certain criteria that make you eligible for a closed school discharge, and there are certain steps you need to take to get a discharge.
Note that you might need your academic records if you plan to attend another school and want to have your coursework at the closed school taken into consideration. So it will be important for you to obtain your academic and financial aid records if your school closes. Contact the state licensing agency in the state in which the school was located to ask whether the state made arrangements to keep the records. The records might also be useful in substantiating your claim for a loan discharge.
You may be eligible for a 100% discharge of your Direct Loans, Federal Family Education Loan (FFEL) Program loans, or Federal Perkins Loans under either of these circumstances:
Your school closes while you’re enrolled, and you do not complete your program because of the closure. If you were on an approved leave of absence, you are considered to have been enrolled at the school.
Your school closes within 120 days after you withdraw.
You are not eligible for discharge of your loans if your school closes and any of the following is true:
You withdraw more than 120 days before the school closes.
You are completing a comparable educational program at another school
through a teach-out agreement with the school,
by transferring academic credits or hours earned at the closed school to another school,
or by any other comparable means.
You have completed all the coursework for the program, even if you have not received a diploma or certificate.