Navigating the Evolving BDTR Landscape: New Claims, Litigation Updates and Regulatory Shifts
Brittany Schoeneck
March 16, 2026
Higher education institutions across the country are facing a new wave of borrower defense to repayment (BDTR) claims. This recent development comes just as the federal government is working to comply with the final terms of a class action settlement involving the backlog of BDTR claims, and after yet another shift in the BDTR regulatory scheme as a result of the One Big Beautiful Bill Act last year.
BDTR Background
The BDTR system is a federal process that allows borrowers with U.S. Department of Education student loans to request loan cancellation if their school misled them or engaged in misconduct related to their education or loans. Borrowers can apply for relief if they believe their institution made false claims about things like job placement rates, accreditation, program quality or transferability of credits. If a borrower’s claim is approved, the government may forgive some or all of the borrower’s federal student loan debt and potentially refund payments already made, and in certain circumstances may seek reimbursement from the institution. BDTR claims, therefore, represent a potential source of exposure for institutions to which they are directed.
