Now don’t get all excited that all ITT student loan debt is going to be barred from collection. The proposed class action lawsuit settlement only concerns the $560 million ITT was holding on its books at the time of its demise. This does not include federal student loans or debt it had previously transferred to other entities.
According to the proposed class action settlement, “ITT holds approximately $560,000,000 of Student Receivables (due to adjustments made and to be made to ITT’s books and records relating to tax returns for ITT’s 2016 fiscal year). The Students dispute the validity of all Student Receivables.”
“The Trustee has confirmed with each of the collection and servicing agents known by the Trustee to have been used by ITT that each has marked the Student Receivables as paid in full or has deleted the Student Receivables from the students’ records and files and the Trustee is advised that no further reporting is being made and no further reporting will be made in the future by such servicers or collection agencies to any credit bureaus, or otherwise, relating to Student Receivables owing to the Debtors.”
The settlement would also require the bankruptcy trustee to refund nearly $3 million collected since the bankruptcy filing.