Grand Valley State University (GVSU) has finalized a $40,000 settlement with a student, Kendra Velzen, 28, who sued the University last year, for the right to keep a guinea pig on campus for emotional support.

She suffers from chronic depression and uses the animal, 'Blanca,' as a pacemaker.

Velzen filed a lawsuit and a complaint at the Michigan Civil Rights Department against the University for violating federal housing rules after she was allowed to keep the pet animal in her dorm room but with restrictions.

The university permitted her to keep the guinea pig in her dorm room but refused to authorize her to take the pet animal to common areas such as classes or food-service areas.

Velzen and the Fair Housing Center of West Michigan decided to dismiss the lawsuit last month and agreed for a settlement.

Apart from $40,000, the university will work with the Housing Center to develop a policy for accommodating support animals in on-campus housing.

The university denies any wrong doing, but agreed on the settlement to save costs of further litigation.

"Should Kendra Velzen ever reapply for on-campus housing and make an accommodation request to live with a guinea pig or animal of similar size and nature, Grand Valley will grant said request," the school told Huffington Post.

Velzen attorney, Stephen Dane of Ohio, told the newspaper that university policy allows students to have only service dogs and no predatory fish on campus. But the university should have made an exception under the Fair Housing Act as she is disabled.

"People truly do get medical benefits, and psychological benefits, out of emotional support animals," Dane told MLive.