There has never been a more important time to focus on student loan servicing issues. The scale of the federal student loan servicing industry and the impacts of its actions are vast. Americans now owe more in student loan debt than they do for auto loans, credit cards, or any other non-mortgage debt.
Of the 44 million student loan borrowers, nearly one in five is currently in default on one or more federal student loans. The consequences of federal student loan default—such as wage garnishment, offset of federal benefits and tax refunds (including the Earned Income Tax Credit), and for some borrowers, a federal lawsuit—are devastating. A judgment…
We applaud many of ED’s proposals to ensure that incarcerated individuals’ renewed Pell Grant eligibility yields the most benefit to them and is not abused by predatory for-profit institutions. However, we urge ED to, at a minimum, automatically enroll all defaulted incarcerated borrowers in Fresh Start. We also urge ED to create a long-term automatic…
Even before COVID-19, student loan borrowers struggled under the weight of more than $1.6 trillion in debt. One in four borrowers was in default or serious delinquency, and many worried about their ability to make student loan payments while covering other basic needs. Because of decades of structural inequities and discrimination, student loans have burdened…
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