Student-loan borrowers whose debt was wiped out are still being reported to credit bureaus, a new lawsuit says.
On Thursday, the Project on Predatory Student Lending, a borrower advocacy group, filed a lawsuit against the Department of Education. It said that the department is violating the Fair Credit Reporting Act by reporting outstanding balances on “cancelled and legally unenforceable debt.”
The lawsuit concerns borrowers whose loans were wiped out via the borrower defense to repayment program, after they were defrauded by “predatory for-profit” schools, including Ashford University and ITT Technical Institute. It specifically pertains to borrowers who received such relief between April…