Home Debts School Loans Law Students Unable To Pay Rent Without Student Loans After School Goes Into Receivership – Above the Law

Law Students Unable To Pay Rent Without Student Loans After School Goes Into Receivership – Above the Law

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‘Where’s my loan money?’

What happens when the company that owns and operates your law school has been put into a federal receivership because it’s drowning in tens of millions of dollars of debt? If you ask the students at Western State College of Law at Argosy University, whose classes started on January 14, they’ll tell you that it means going without the loan disbursements necessary to purchase their books, pay their rent, and buy food.

Dream Center Education Holdings, which operates the 53-year-old law school, was placed in receivership the same week classes started, and the consequences were almost immediate. Not only did the Western Association of Schools and Colleges Senior College and University Commission quickly notify Argosy University that it could lose its accreditation unless it showed within a year that it had the money to continue operating, but numerous staff members at the law school have already been let go, including librarians, the career services director, the dean of alumni engagement, and the executive assistant to the deans.

The receivership also caused issues with the Department of Education, and student loan disbursements have since been held up for the first three weeks of class. Students say that since January 19, the administration has told them that they’re trying to get their student loans disbursed, but thus far, nothing has happened — and if it has, they’ve been kept in the dark about it.

A source relayed that he’d been in touch with the special counsel for the receiver who was “pretty cryptic with his explanation of what was going on; he made it sound like the receiver was looking for a buyer for WSU.” To our understanding, students at Western State have not been told about this development.

On that note, student leaders at the school are now expressing their concerns about an unfair lack of transparency from the administration, as their classmates have been seen crying in the hallways. Here’s what one student told us:

We’ve been told since January 19 that the school is working to get our financial aid and still nothing. Students are contemplating dropping out, dropping to part time, whether to buy food or pay rent or buy books. The school requested that students “petition” for $50-$100 Visa gift cards to help with expenses and we still haven’t even received that.

Third-year students at the school are particularly troubled by what’s going on:

Our foundation has been shaken and this delay is not only threatening the security and stability of every student here, but it has caused such a disruption that it has diverted our focus away from where it needs to be, on our classes and our bar prep. Our success is being sabotaged by something beyond our control.

We received no warning, which means we were robbed of an opportunity to make this impact less severe. Now we deal with the carnage of something we did not see coming. On a fundamental level that is wrong.

We’ve reached out to the administration at Western State Law to gain greater insight as to what is happening and when students will receive their loans for the semester but have not yet received a response.

What is happening to students at Western State Law isn’t right, and it certainly isn’t fair. Based upon student accounts of the situation as it unfolds, they’re being forced to suffer in the dark without the bare essentials that they need to survive. Something must be done about this situation, and fast, especially if this is having an adverse impact upon students’ mental health and wellness.

If you’re a student at Western State Law, we ask that you please check up on your classmates and make sure they’re alright. If you think something seems off, talk to them about the situation and make sure they get help. If you or someone you know is in need of help, please call a lawyer assistance program in your state (don’t be fooled by the name; these programs also provide services to law students as well).

As Art Institutes and Argosy University enter receivership, what’s next? [Orange County Register]


Staci ZaretskyStaci Zaretsky is a senior editor at Above the Law, where she’s worked since 2011. She’d love to hear from you, so please feel free to email her with any tips, questions, comments, or critiques. You can follow her on Twitter or connect with her on LinkedIn.

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