Student loan False Certification Discharge

This article describes about student loan false certification discharge, the various eligibility criteria and how you can apply for it.

Updated by Rakshitha N on 4th July 2020

Students face problems during their study and among them, the student loan false certification comes into picture. A student loan false discharge certification also known as cancellation programs which is given to students who are victims of unauthorized payment forgery,or a falsely certified as eligible for a federal aid. The discharge of loan includes Federal Family Education Loan (FFEL) Program,Federal Direct loan, Parent Plus loan. Read the article to know more about the eligibility and how to apply for loan discharge.

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What is Student loan discharge?

Student loan discharge involves the cancellation of debts due to some criteria such as identity theft, false certification,fraud. When a student qualifies for a false certification discharge,he gets 100% loan forgiveness,and isn't expected to repay the loans or charges associated with the loan. The payments made on the loan also get reimbursed.

Only federal loans are eligible for false loan certification discharge, they include,

  • Direct Loans

  • Parent plus loans

  • Consolidation loans

  • Grad Plus loans

Are you eligible for student loan false certification discharge?

There are 4 criteria with fall under the student loan false certification.You might be eligible the loan discharge certificate under any of these categories,

Ability to benefit

A student is eligible for a false discharge certificate if he isn't eligible for the education he is receiving i.e if the student doesn't have a high school degree or GED, the student is falsely certified to meet the eligibility for a federal aid and did not meet the ability-to-benefit student eligibility requirement that affects at the time of school.

You can apply for a discharge certificate with issues regarding the ability-to-benefit exam was not approved or the school failed to give you an exam.

False certification of eligibility of students mostly happens with students who applied without a GED and with those who studied at a homeschool. 

Ability-to-benefit condition can be applied in certain circumstances such as:

  • If the school failed to give an Ability-to-benefit test for students.

  • If the U.S Department of Education did not approve the test.

  • If the school encourages malpractices during the test.

  • If the school certifies a student to be eligible even after failing that exam.

For example, Henry joined a college program and was certified for a federal aid,later as he did not own a high school degree he was given the ability-to-benefit exam, The test examiner helped him during the tests and the US Department of Education did not approve the test and hence, he was eligible for for the false discharge certification,

Disqualified status

The student is eligible for a false certification discharge when he is unable to meet the minimum requirements for employment of your specialization due to certain reasons such as age, criminal record, a physical or a mental condition unable to support you for employment. These are some reasons that are accepted by the U.S. Department of Education for a loan discharge certificate, and the condition is applicable when these conditions occur when the loan was being disbursed.

For example, Jenny was a nursing student who received federal aid to cover her tuition, but she has a criminal record and was jailed for a few years. She later realised that a nursing student who is a feeling isn't eligible for nursing, hecne she was eligible for a loan discharge certificate.


Forgery, also called unauthorized signature, is a condition for false certification of discharge. You are eligible for this if your school  forged your signature to transfer funds without your knowledge or recieved your loan papers or check endorsements without your signature. You must have not received the proceeds of the loans. If someone forged your signature and name for your loans at your school, you can still raise it as a defence to collect your loans.

You must know the identity for the forger,you should be able to prove that your signature was forged and have a promissory note to request the department to collect your loan.

For example, a student applied for a federal loan for a school, after a few months the school program started and later he realised that he had not signed or received a disbursement, the loan was disbursed without his authorization, so he was eligible to claim or the false certification discharge. 

Identity theft

In this category if a person borrowed loans with your name for one's own benefits, this is addressed as identity theft. If you are a victim of this, you must be aware about who convicted this crime to report to the police. You may proceed with evidence about the crime committed with your identity to the U.S Department of Education to receive back the federal aid.

For the exam, Jim applied for a degree course and when he applied for a federal aid, he learnt that a loan was already being borrowed with his identity and hence he was eligible for the false certification discharge and he reported to the police about the crime, the amount was reimbursed.

Easy ways to apply for a false certification discharge

If you are a victim of false discharge and you fall under any of the eligibility criterias  listed above, you can apply for the false certification discharge by easy ways, they are listed below,

Ability to benefit

If you are a student who is a victim at a school that falsely certified your eligibility for a federal aid , you fill out the LOAN DISCHARGE APPLICATION: FALSE CERTIFICATION (ABILITY TO BENEFIT)  application form by the U.S. Department of Education. 

If you are already in the process of payment of your loan, you must contact your loan servicer with this application form.

Disqualifying status

If you want to apply for the disqualifying status condition of the false certification discharge of the , you need to fill out the LOAN DISCHARGE APPLICATION: FALSE CERTIFICATION (DISQUALIFYING STATUS) and contact your loan servicer or the creditor.


If you re a victim of forgery and a loan was disbursed without your authorizations, to seek help you must fill out the LOAN DISCHARGE APPLICATION: FALSE CERTIFICATION (DISQUALIFYING STATUS)  and mail it to your loan servicer to seek help regarding the false certification discharge.

Identity theft

There is no aid by the U.S. Department of education to help you with your identity theft, hence you must report/ file a case to the police.

What to expect after qualifying for the false discharge certificate?

After you fill out the application form according to the eligibility conditions, you qualify for the false certification discharge. Upon suitable investigations and factors, you are approved and the loan under your name gets reimbursed and you are ot expected to pay the loans and the payments made earlier i.e voluntarily or involuntarily are refunded.

Coming to your credit score, after the loan is reimbursed, with the help of your lendor or your loan servicer your credit damage is recovered.

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What you should do when you're denied?

After applying for the false certification discharge, your application may be denied due to certain reasons, then you have to appeal for a review to the U.S. Department of Education. You must provide some evidence if any. If your application is still disqualified, you have the right to approach the federal court within 30 days.


If you are a victim who falls under some eligibility conditions to apply for a student loan false certification discharge, you can ease the process of appealing to the U.S. Department of Education regarding the federal loan  which is reimbursed under false certification.

If your application gets approved, you must cooperate with the U.S. Department regarding the false certification discharge and it gives you a chance for you to get rid of your student loans.

Your loan gets reimbursed and the payment you made is refunded back. You are also required to transfer the borrowers rights to recover against the third party.