What should He do?

I have a very close friend who applied for a loan before entering college. Upon starting classes, the Director of Financial Aid, who is no longer employed at this institution, permitted my friend to go to class while his loan was pending. And unfortunately towards the end of the semester, his loan was denied and now he owes the school A LOT of money, and he cannot continue his education until it is paid off. From my understanding, it should not take that long for a loan to pend, and the Financial Aid counselor should not have let him attend classes unless it was approved right? So is he still liable to pay the school, considering this situation is not his fault? And he should have been purged WAY in advance. I know I could not begin school without my loan being approved, and we attended the same school! What should he do? is this a sign of negligence on account of the school? Is this grounds for legal action?

I tend to agree with Mar as to whether he has a case. At least in California the Director of Financial Aid would have apparent authority to speak for the institution. There may have been negligent misrepresentation that the friend relied upon. Furthermore, in California at least, the oral representations may relieve the friend from not reading specific materials--in California a person cannot mislead and then rely on the written contract. Of course proof is a problem.

However, even if he owes a lot of money, can he afford an attorney? My feeling (informal) is that the going rate in Los Angeles is $250+ per hour (and it may be more). Maybe if he goes to legal aid they can help him.

Here is the ABA (American Bar Association) link to their pro bono regional list. It is a pretty good and comprehensive list.

http://www.abanet.org/legalservices/find...

I think he might have a case against the school. When the Director got fired they accepted the responsibility for his decisions. Seek a reliable attorney that will fight for the cause NOW...

"...unless it was approved, right"
Are you answering your own question?

Wrong. Obtaining financial aid is totally independent of admission and attendance in a school. Read the paperwork your friend signed in agreeing to pay for the education. It doesn't say "assuming you get financial aid".

"...And he should have been purged WAY in advance"
what does that mean?

"I know I could not begin school without my loan being approved"
That is not accurate, but it would be smart not to attend until approved.

The only negligence is your friends, negligence in taking something they could not pay for.
For example, you go to a restaurant where there is a sign in the window that says Visa credit cards accepted. You eat. You try to pay for your meal with your creditcard, which is rejected. Is the restaurant negligent for not checking your credit before you ate?

Your friend ought to cut a deal to pay less or in increments.