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☆ Why paying off your student loans won't get easier anytime soon
▼ + stars: | 2023-10-02 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +14 min

Student-loan borrowers are entering uncharted territoryThe Education Department has never had to reenter 28 million people into payments at the same time. Plus, federal servicers' technology may not be up to the task. In contrast, federal student-loan servicing has been contracted out to five companies, and the government doesn't have the resources to fully keep tabs on the industry. "So there really were deep-rooted structural problems in the loan programs on the policy design but also on the execution side," Kvaal said. As the years went on, the GAO continued to identify flaws in student-loan programs that were hurting borrowers.

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☆ Student-loan borrowers should be on the lookout for misleading repayment practices that could make them pay 'more than they should,' a federal watchdog says
▼ + stars: | 2023-09-05 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The CFPB warned student-loan borrowers that their servicers might engage in misleading behavior. On Tuesday, the Consumer Financial Protection Bureau released a blog post outlining what protections and options borrowers have as payments resume. The agency has long been looking into potentially misleading behavior that has put student-loan borrowers at risk. As Insider previously reported, the transition back into repayment will be a significant challenge for borrowers, the Education Department, and student-loan servicers. AdvertisementAdvertisementStill, the Education Department said it remains committed to ensuring borrowers are receiving the best information from their servicers on their options for repayment.

Persons: servicers, CFPB, Rohit Chopra, Joe Biden's, Carolyn Fast Organizations: Service, Consumer Financial, Education Department, The Century Foundation Locations: Wall, Silicon

☆ Why student-loan borrowers could face a 'perfect storm' of obstacles once payments resume next month
▼ + stars: | 2023-09-04 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +7 min

Experts told Insider lack of broad debt relief and high inflation could contribute to the challenges. After more than three years, President Joe Biden officially ended the pandemic pause on federal student-loan payments, with waived interest, on Friday. "Before the pandemic, borrowers were already choosing between meeting their own basic needs and making their student-loan payments. "The more resource-strapped a servicer is and the more resource-strapped FSA is, the heightened concerns we have for that treatment of borrowers and just for the accuracy on the part of servicers giving information to borrowers," Hall said. In the meantime, the department recommends borrowers make their payments and wait for Biden's new plan for broad debt relief.

Persons: Joe Biden, she's, it's, Carolyn Fast, servicers, Biden, Stephanie Hall, Hall, Scott Buchanan, —, there's Organizations: Service, The Century Foundation, Education Department, An Education Department, Center for American Progress, Department, Student Loan, —, Management, Federal, Aid, Federal Student Aid Locations: Wall, Silicon

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