Discharging student loans through bankruptcy is hard. So hard that most people do not try even though they may qualify for some relief. But a certain section of federal law that has been buried in obscurity over the last twenty years is suddenly gaining the spotlight. This code section, known as the “borrower defense” provision, may provide an easier alternative to bankruptcy for petitioning to discharge student loans.

A Wall Street Journal article states that thousands of students are applying for federal student loan forgiveness through this program. To qualify for loan forgiveness under the borrower defense provision, the applicant must prove that they attended the school based on false information about graduates’ job prospects, in violation of a state law.

Borrowers can apply for forgiveness through the Department of Education website. You may notice that the website specifically addresses Corinthian Colleges students. But according to another Wall Street Journal article, the program is open to all borrowers with direct federal loans who can establish their school violated state law in getting them to take out the debt.

The rules on under what circumstances the loans will be discharged is unclear. The government is currently in the process of drafting guidelines. But according to a report from the special master charged with making recommendations to the Department of Education on this issue, claims will be evaluated for a pattern of misconduct from schools:

Pursuing this mode of inquiry will allow the [team] its best opportunity to establish broad based patterns of misconduct and to provide relief to a significant number of claimants more quickly. In this regard, it is important to note that the statements by claimants in their own words of how they were treated by the schools against which they have made a claim will be helpful to our resolution of claims. This will help increase understanding of what happened to students and whether state law was violated.

While this program was designed to help those who were duped by for-profit colleges, in a statement to the Associated Press, Department of Education undersecretary Ted Mitchell said, “We will continue to provide forgiveness to every student who has been similarly mistreated.” Will this include graduates of low-ranked law schools that reported fraudulently employment statistics to the ABA and U.S. News? While the answer seems intuitively obvious, it is unclear.

I should point out that the Department of Education has the authority to clawback forgiven loans from schools and penalize the institutions that engage in this behavior. This was the impetus for the closure of the Corinthian Schools last year. Because a clawback can be financially ruinous, law schools will put up a fierce lobbying campaign to show that they were not engaging in fraud. They will likely point to the law school class action lawsuits where most courts held that schools were not engaging in fraud even though many low-ranked schools were reporting $160,000 per year starting salaries for 99% of their graduates. The rationale was that law school applicants are college graduates and a “sophisticated subset of education consumers“.

This “sophisticated consumer” reasoning has been heavily criticized and it is ultimately irrelevant because the borrower defense forgiveness program looks at an applicant’s own unique circumstances. A ruling that addresses an entire cohort of students should not be given any deference whatsoever.

So should law school graduates who are chronically unemployed or underemployed apply for forgiveness under this program? While there is a chance that the application will be denied, I think it is worth it to apply for the following reasons.

First, applying for forgiveness seems relatively simple and is not a matter of public record. So those who are concerned about being publicly smeared as unemployable, entitled, freeloading whiners by the apologists and curmudgeons have nothing to worry about.

Second, loan collections will be put on forbearance while the borrower’s defense application is reviewed.

Third, the Department of Education in conjunction with the Department of the Treasury has announced that loan discharges granted under the borrower defense provision will not be considered taxable income.

Finally, I think the Department of Education will be more sympathetic when evaluating applicant claims. The special master’s report made this introductory comment:

The unfortunate reality is that some colleges, including certain career colleges, have used abusive practices to prey on students. They have made false and misleading statements to students or prospective students about the value of certain career college programs or the financing needed to pay for a program. Such practices can have serious adverse effects for both

students and taxpayers. Accordingly, prior to my appointment, Secretary of Education Arne Duncan made it clear that such predatory practices would not be tolerated. He also stated that students affected by such practices would receive the loan relief they deserved under the law. My paramount goal as Special Master is to develop a system for providing debt relief to borrowers that is fair, transparent, and efficient, with minimal burden on borrowers. Under Secretary Mitchell asked me to advise on the creation of a durable process—one that would, consistent with the Higher Education Act, be applicable to the crisis that unfolded with the closure of Corinthian Colleges, but also one that would apply more broadly to students at all institutions who believe they have been defrauded by their colleges.

The next question is whether there is anything an applicant can do to maximize her chances of a successful discharge. I admit I have no idea how the Department of Education will review cases, so unless you know someone who successfully obtained a discharge, I can only make the following recommendations.

First, have documentation proving that you were defrauded. Provide a copy of the U.S. News law school rankings for the year you applied. Keep any emails or written communications from the law school’s admissions office about job prospects.

Second, provide a detailed employment history. Bonus points if you were able to secure those coveted “JD Advantage” positions such as file clerk, cashier, janitor, and barista, to name a few.

Finally, spend some time making a good faith effort to get a job before applying. Don’t be like Brunner and apply for forgiveness one month before your student loan payments start. Your application is likely to get denied.

If enough borrowers are granted relief under the borrower defense program, the Department of Education will eventually start investigating law schools that continue to admit underqualified students who end up with no jobs and are unable to pass the bar exam. The Department will question why the administrators at some of these “non-profit” schools are being paid more than the President of the United States. They may also be very interested in clawing back some of the millions in profits earned by for-profit schools.

If enough law schools feel the financial pain, they will stop kowtowing to the U.S. News rankings system that encourages high tuition pricing and try to operate in a financially responsible manner. Those that don’t will eventually suffer the same fate as the Corinthian Colleges.

Shannon Achimalbe was a former solo practitioner for five years before deciding to sell out and get back on the corporate ladder. Shannon can be reached by email at sachimalbe@excite.com and via Twitter: @ShanonAchimalbe.