Maybe I wasn't clear: the new school already admitted me, to the Spring semester. They are able to issue me a new I 20 right now, and they are willing to do it. I checked on http://www.ice.gov/sevis/f_1_transfe...#_Toc174419525 , and as long as the new program starts in within 5 months by the time you transfer, you can stay in the US. Both the DSO at the transfer-out school and the one at the transfer-in school confirmed that this is doable.
The DSO at the transfer-out is just refusing to initiate the transferring process, because they say I owe the money.
My question wasn't about getting sued and having a bad credit (I asked that question on the specific message board). My question was: is it legal for a DSO to refuse to transfer a student's immigration record to another school just because of an internal matter such as a bill?

