Image: Makenzie Vasquez of Everest College

Makenzie Vasquez, of Santa Cruz, Calif., poses for a picture in Washington, Monday, March 30, 2015. Former and current college students calling themselves the “Corinthian 100” say they are on a debt strike and refuse to pay back their student loans. Manuel Balce Ceneta / AP

Students at the abruptly shuttered Corinthian Colleges campuses have some tough choices to make in the coming weeks. The 16,000 affected students can seek debt forgiveness for their student loans, but to do so, they have to walk away from the time and money they already invested in their education.

Through the Department of Education’s closed school discharge, current students and others who withdrew within the past 120 days can apply to have their federal student loans dismissed — but only if they don’t transfer their credits and complete a comparable program at another school.

“Do they decide to continue on in coursework they may have started or do they decide to step away and get a fresh start from debt?” said Ben Miller, higher education research director of the education policy program at think tank New America.

For instance, if a student who was enrolled in a nursing assistant program transferred credits to a community college and got a nursing assistant certification there, he or she wouldn’t be eligible for a loan discharge. But if that nursing student got to the community college and decided to be a radiology technician instead, it’s likely the loans could be discharged. Most students are unlikely to transfer credits they’re not able to use if they plan to switch fields of study.

The situation has students frustrated and confused. “I would like to know if I am allowed to transfer my credits, if the credits even mean anything,” Dominique Avila, 35, who withdrew from Heald College’s campus in Roseville, Calif., late last year, told The Associated Press. Avila is trying to get her transcripts transferred to another school. “What does that mean as far as my debt goes?”

The Attorney General of California, where many of the closed schools are located, has a page on itswebsite with resources for students seeking relief from student debts they incurred at Corinthian. California also has a student tuitionrecovery fund that provides relief from private student loans, and advocacy group the National Consumer Law Center has a list of other states with similar funds.

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California is one of nine states whose attorney generals sent a letter earlier this month to Secretary of Education Arne Duncan, urging him to waive all Corinthian students’ loans after an investigation found the school gave students false information about their job and earnings prospects. Student advocacy groups also are arguing for the loans to be waived.

Some current and former students have gone on a student loan “strike,” holding off payments in protest.

“The issue that we and others have raised is for students who are at Corinthian campuses that did not close today…those students are not being offered closed school discharges,” said Pauline Abernathy, vice president of The Institute for College Access and Success. “Given the widespread evidence of fraud and the use of bogus job placement rates…those students also deserve the option of a federal student loan discharge,” she said. The National Consumer Law Center also has a petition urging the department to waive Corinthian students’ debts.

No easy road

Even the students who have the option to discharge their debts won’t have an easy road forward. The process can be confusing, and the burden of figuring it out is largely on students’ shoulders, Miller said. “That’s really the challenge. There is a clear process for students at these campuses to get these loans discharged, but the question is, how good is the advice going to be…and how easy or difficult will the process be?”

Since student loans have a six-month grace period, Robyn Smith, of counsel at the National Consumer Law Center, said students shouldn’t panic and make any decisions without doing their research. They should especially be leery of solicitations from other for-profit schools, she said.

The Department of Education plans to participate in transfer fairs with Corinthian. The goal would be to match students up with other schools where they can transfer their credits and complete their education, but there’s no guarantee this will be successful for many students, since most nonprofit institutions won’t accept credits from for-profit schools.

“For-profit credits are largely not transferrable,” Smith said.

It might not be financially smart for students to get some of their credits accepted, she warned. “If you even transfer one credit, you won’t be able to get a closed school discharge.”

Applying for a loan discharge has other financial implications for students who want to start from scratch earning a degree. For-profit schools aggressively pursue and enroll financially vulnerable populations like single moms, veterans and minorities, many of whom qualify for federal Pell Grants. These don’t need to be repaid, but there’s a lifetime cap.

“Unfortunately, under current federal law, they don’t get those back,” Abernathy said. “If they used up their allotment… the clock doesn’t turn back on their Pell Grants.” Students who relied on these grants in the pursuit of a virtually useless Corinthian degree will have to complete their education without that assistance the second time around.