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Florida Coastal School of Law's federal student loans are back on track.

The school announced Thursday that it had resolved a delay in the disbursement of loan funds from the U.S. Department of Education, and that students should expect to see those funds deposited into their accounts on Sept. 16. The U.S. Department of Education confirmed that the funds are forthcoming.

The fall semester began on Aug. 26 and the loan funds for the fall were more than a week late, sparking concern and confusion among students about how to pay for their living expenses, as well as what the delay could mean for the school's status with the education department.

"Please know Florida Coastal leadership takes very seriously the delay in disbursement of student federal financial aid funds, and we understand this delay created undue hardship and stress for our students," the school said in a statement. "Florida Coastal is dedicated to serving its student needs and has been working directly with the [Education] Department to resolve the issue as quickly as possible."

The school denied rumors that the education department had released student loans funds this week but that Florida Coastal failed to funnel those funds to students. Newly appointed Florida Coastal president Peter Goplerud said in an email Friday that the school was required by the education department to submit a "letter of credit," which is an added regulatory step mandated when an institution fails to meet the department's financial responsibility standards. Those standards are intended to ensure institutions that receive federal loans have the financial means to remain in operation. Letters of credit require institutions to prove they have access to credit amounting to at least 10% of the annual federal loans their students receive.

The unexpected delay in loan disbursements triggered speculation about Florida Coastal's future, in part, because the 2017 demise of the school's sister institution—the Charlotte School of Law—began with the education department cutting off access to federal student loans. A third law school also owned by InfiLaw Corp., Arizona Summit Law School, also closed in 2018.

But Florida Coastal's fortunes have been improving. The school in June was found to be back in compliance with the American Bar Association's law school standards, and the academic credentials of its incoming students have been on the rise on recent years. However, former dean Scott DeVito resigned abruptly this week, saying only that it was the right time to leave. Days later, the school announced that former dean Goplerud was returning to the campus as president, and that academics dean Jennifer Reiber is serving as interim dean.

With the loan matter solved, Florida Coastal is still working to earn approval from the ABA to transition from a for-profit law school into a nonprofit institution. The ABA last month denied the school's initial application.