For 1,354 former ITT Technical Institute Students in Indiana, financial relief is on the way. The Indiana Attorney General’s Office has been able to win their case against PEAKS Trust for $10 million of debt relief for the former students. PEAKS Trust provided private loans during the 2008 financial crisis for students who were unable to secure school loans from other private sources as a result of the crisis. Indiana, 46 other states, and the District of Columbia will all benefit from the settlement.
In the filed complaint with the District Court for the Southern District of Indiana, it was said that PEAKS was responsible for overseeing private loans to students who attended ITT Technical Institute and in doing so, were involved in unfair acts and practices that violated the Consumer Financial Protection Act of 2010. The complainant alleged that PEAKS was well aware that the students who were accepting the loans:
- Did not know that they had them
- Did not understand the loan terms
- Were unable to pay the loans back
ITT worked with PEAKS to develop a credit program for students to cover the gap in their tuition costs that were not covered by federal student aid. When it was time to pay the credit, ITT put massive pressure on students in addition to engaging in intimidation tactics to take loans from PEAKS so they could pay the credit. The loans that the students were cowed into taking had excessively high-interest rates that exceeded rates of federal loans. Many of the students who took the loans under pressure were from low-income backgrounds. For these students, the choice was to accept the loans or drop out of school. Dropping out of school would make all the credits that were earned while at ITT virtually worthless because many other schools do not accept ITT credits.
What Was the Final PEAKS Settlement?
Across the nation, all of the states and the District of Columbia who secured the settlement were awarded a total of $330 million. Also, approximately 35,000 students nationwide will be granted debt relief. PEAKS had to cancel all debt that students had with them, and they had to cease doing business. Additionally, PEAKS is required to connect with credit reporting agencies to have the affected borrowers’ information be updated to reflect better credit.
It is PEAKS responsibility to inform affected students of their debt relief. Students do not have to do anything to benefit from the settlement. Included in the notices from PEAKS will be an explanation of rights and if any student has a question about the process or the notice they are directed to contact PEAKS customer service or the Consumer Financial Protection Bureau.
Find an Indiana Family Law Attorney Today
Paying for college is one of the most expensive prospects parents face as their children become of age where they are ready to attend school. If you are facing a divorce in Indiana you have a lot of considerations, including financials related to your family. Christopher L. Arrington is an experienced Indiana divorce attorney who can help you with the process, answer all of your questions, and remove much of the stress associated with the legal process of divorce so you can make a free break and continue living your life.
Call Christopher L. Arrington, P.C. today to schedule your free consultation with a knowledgeable Danville divorce attorney at (317) 745-4494.