Working with the Kentucky Attorney General’s Office, Mid-Continent University Administrator Tim Walker said students with outstanding debt will soon receive a letter outlining their repayment options.
MCU is working on a reorganization plan after filing for Chapter 11 bankruptcy last year.
The Department of Education stopped giving the school federal financial aid two years ago after noticing improper bookkeeping. Walker said the school fronted that money to students to the tune of $11.7 million.
He said it was the university’s money – never the federal government’s – and students are still on the hook to repay their loans. Walker said students will get a balance statement with several repayment options.
They include: A 20% discount with a 0% interest rate, a 30% discount if the balance is paid within 30 days. Walker said some students could qualify for a discharge where they wouldn’t have to pay any money back, depending on the loan they received.
Another option includes an MCU loan which is designed to match the terms and conditions of federal student loans. It is a private loan and not administered through the federal government. Students can receive this loan if they meet certain criteria.
The school’s reorganization plan is due May 1st.