The Center Square [By Vivian Jones]-
Tennessee Attorney General Herbert Slatery has announced his office reached a settlement agreement to provide former Tennessee students enrolled at ITT Technical Institute with a total of $15 million in student loan forgiveness.
About 2,068 student loans of former ITT Tech students will be forgiven as the result of a settlement.
“Many former ITT students in Tennessee were put in a terrible position by the school and its loan program,” Slatery said. “This settlement puts an end to PEAKS loan collection and requires it to stop doing business.”
The settlement is between 43 attorneys general, the federal Consumer Financial Protection Bureau, and PEAKS Trust, a private loan program run by ITT Tech.
According to the settlement, PEAKS will forgo collection of the outstanding loans and cease doing business. PEAKS also will send notices to borrowers about the cancelled debt, ensure automatic payments are cancelled and supply credit reporting agencies with information to update affected borrowers’ credit information.
ITT filed bankruptcy in 2016 amid investigations by state attorneys general and after action by the U.S. Department of Education to restrict access to federal student aid. Nationally, PEAKS Trust will provide about $330 million in debt relief to about 43,000 loans associated with students at its 148 locations around the country.