The FTC says University of Phoenix relied on deceptive advertising, including claims that it worked with employers such as Microsoft, Twitter, Adobe, and Yahoo to create job opportunities and tailor coursework to employer needs. Because money remained in the fund, the FTC says it is now sending an additional round of payments to people who accepted a previous payment and paid University of Phoenix $37,201 or more.

That refund is real. It also may not be the whole story.

The FTC page says some former students may also pursue borrower defense, which is the Department of Education process that can lead to federal student loan discharge when a school used certain misleading statements or other misconduct. So yes, cash matters. But debt relief is the plot twist that can actually move the balance.

What happened with University of Phoenix?

According to the FTC, University of Phoenix used deceptive advertising to attract students. The agency says it previously sent payments in March 2021 and July 2023, resulting in more than $48.7 million in refunds, and is now sending an additional 21,543 payments totaling over $432,000 because money remains in the fund.

If you get a check, the FTC says to cash it within 90 days. If you get a PayPal payment, accept it within 30 days. This is not the time to let important mail age like a banana on the counter.

Quick note: The FTC also says receiving a settlement payment should not affect a pending borrower defense application. So a refund payment and federal loan discharge are not the same thing, and one does not cancel out the other.

Brief explainer: what borrower defense actually is

Borrower defense is a federal student loan discharge process for borrowers whose school committed certain misconduct. The official application explains that claims may involve misleading statements, concealed facts in some cases, or other school conduct tied to things like job outcomes, program costs, transfer credits, licensing, and financial aid.

The short version is this: if a school sold you a story that was not true, and that story mattered to your decision to enroll or stay enrolled, borrower defense may be worth a closer look. Bureaucracy still wants receipts, though. Emotional damage alone is not a PDF.

How to apply, and what makes an application stronger

The best place to start is the official borrower defense page. From there, borrowers can review the program and get to the application process. The Department’s application materials make one thing very plain: details matter.

  • Explain what the school said or hid.
  • Say who told you and when.
  • Show why it mattered to your decision to enroll or stay.
  • Describe the harm, not just the annoyance.
  • Attach documents like emails, brochures, catalogs, enrollment agreements, transcripts, or screenshots when you have them.

A stronger application usually looks less like a rant and more like a timeline. One clear claim. One clear set of facts. One stack of documents that can do some of the talking for you.

Useful links: Borrower defense overview and application hub · Borrower defense updates

Borrower defense updates, minus the bureaucratic fog

If University of Phoenix is what brought you here, borrower defense updates are what make the bigger picture easier to see. The Department’s update page tracks school-specific discharge actions, and some of them are large enough to make your student loan statement feel personally attacked.

Slide 1

Ashford University Discharge

ED says about 261,000 borrowers will receive about $4.5 billion in automatic discharge. The findings involved licensure, transfer credits, cost, financial aid, and time to degree. That is a long list for a school brochure and an even longer list for a federal agency.

Slide 2

Center for Excellence in Higher Education

ED says about 73,600 borrowers who attended schools like Independence University, CollegeAmerica, Stevens-Henager, and California College San Diego will receive over $1.15 billion in automatic discharge. No action needed for covered borrowers, which is refreshing for once.

Slide 3

Drake College of Business Discharge

ED says about 11,000 borrowers will receive $107 million in automatic discharge. The findings involved stipends, externships, and graduate employability. “Career-ready” should not feel like an improv prompt.

Slide 4

Lincoln Technical Institute

ED says about 280 borrowers tied to certain Massachusetts criminal justice programs will receive about $1.4 million in automatic discharge. Smaller group, same message: job placement claims matter.

Slide 5

The Art Institutes

ED says nearly 317,000 borrowers will receive over $6.1 billion in automatic discharge. The findings involved graduate employment rates, salaries, employer connections, and career services. That is a very expensive way to learn that “networking opportunities” can be doing a lot of cardio.

Slide 6

University of Phoenix

ED says more than 1,200 students received nearly $37 million in discharge tied to the school’s “Let’s Get to Work” campaign. The update says the advertised employer partnerships did not deliver the benefits students were led to expect.

Slide 7

Westwood College

ED says about 79,000 borrowers will receive nearly $1.5 billion in automatic discharge, including borrowers who never applied. The findings involved employment prospects, criminal justice outcomes, and transfer-credit claims. Credits that do not transfer are basically academic frequent-flyer miles.

Slide 8

Corinthian and ITT

ED says about 560,000 Corinthian borrowers will receive about $5.8 billion in discharge, while about 208,000 ITT borrowers will receive nearly $3.9 billion. These are not tiny cleanup jobs. These are billboard-sized warnings.

What to do next

If you get the University of Phoenix refund, do not let the deadline pass. Then look at borrower defense if you believe the school misled you. The official materials are pretty consistent about what helps: specific facts, a clear story, and supporting documents.

And if your school appears in the borrower defense updates, pay attention to one detail above all: whether relief is automatic or whether you still need to apply. That single difference can save people a lot of confusion and at least one unnecessary stress spiral.

Source: This article is based on the FTC’s official University of Phoenix settlement refund page, the official Federal Student Aid borrower defense page, and the Federal Student Aid borrower defense updates materials.