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☆ After 35 years, he got $119,500 in student debt forgiven. Then the government refunded him $56,801
▼ + stars: | 2024-02-16 | by ( Annie Nova | ) www.cnbc.com time to read: +5 min

Under the U.S. Department of Education's income-driven repayment plans, student loan borrowers are entitled to get any of their remaining debt forgiven after 20 years or 25 years. Scott Buchanan, executive director of the Student Loan Servicing Alliance, a trade group for federal student loan servicers, refuted that the companies benefit by veering from the government's orders. Shortly after Fox heard that his student loans were forgiven, he received a payment from the government for $56,801. When he told people he was still paying off his student debt, they scratched their heads. Over the decades, based on Fox's records which CNBC reviewed, he paid around $200,000 to his federal student loans.

Persons: Marlon, George, servicers, Nadine Chabrier, Fox, he'd, Scott Buchanan, Buchanan, I've, Marlon Fox, overpayments, Biden, Debbie Organizations: Biden, U.S . Department, Center for, Lending, The Education, Student Loan, Alliance, Palmer College of Chiropractic, CNBC Locations: forbearances

☆ How to figure out your timeline to student loan forgiveness, as more borrowers become eligible
▼ + stars: | 2024-01-17 | by ( Annie Nova | ) www.cnbc.com time to read: +1 min

Chris Tobin | Digitalvision | Getty ImagesBeginning in February, certain student loan borrowers who have spent a decade in repayment will get their federal student loan debt forgiven, the Biden administration recently announced. Most borrowers need to make payments for 20 years or 25 years on an income-driven repayment plan before their debt is erased. To qualify for the aid, you'll also need to make sure you have eligible federal student loans and that you're enrolled in the SAVE plan. Pandemic-era payment pause countsOther forbearances, deferments may count, tooThe Department of Education gives federal student loan borrowers several options to pause their payments. Due to the timeline of regulatory changes, borrowers may have to wait for some of these periods to be credited to their forgiveness timeline under the SAVE plan.

Persons: Chris Tobin, Biden, you'll, deferments Organizations: Digitalvision, U.S . Department of, Valuable Education, Education, SAVE, of Education, CNBC, Time

☆ Student-loan borrowers are facing 'serious risks' to their credit scores following the 'chaotic' payment resumption, 4 Democratic lawmakers say
▼ + stars: | 2023-12-04 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

Four Democrats recently wrote a letter that raised concerns about student-loan repayment challenges. They said they're worried servicer errors could hurt borrowers' credit scores. AdvertisementIt's been just over two months since federal student-loan payments resumed and millions of borrowers have already faced a range of difficulties with the transition. Elizabeth Warren, Bernie Sanders, Richard Blumenthal, and Chris Van Hollen sent a letter to Education Secretary Miguel Cardona expressing concerns about challenges student-loan borrowers have faced over the past few months. "For example, we are concerned that ED's credit reporting processes may expose borrowers' credit scores to unanticipated consequences," the letter said.

Persons: they're, —, It's, Elizabeth Warren, Bernie Sanders, Richard Blumenthal, Chris Van Hollen, Secretary Miguel Cardona, it's Organizations: Education Department, Service, Democratic, Secretary, Department, Democrats, Federal Student Aid, House Republicans Locations: Sens

☆ Some student-loan borrowers are surprised to find their accounts are suddenly in forbearance. Here's why that might be happening.
▼ + stars: | 2023-11-09 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +5 min

Some student-loan borrowers are logging into their accounts and seeing it in forbearance. AdvertisementAdvertisementIf you recently logged into your student-loan account and were surprised to see it placed in forbearance, you're not alone. Over the past few days, student-loan borrowers primarily serviced by MOHELA have logged into their accounts to see their loans were no longer in active repayment. Still, the borrower's account continues to show a payment due with interest accruing, according to documents reviewed by Insider. AdvertisementAdvertisementWas your student-loan account placed on administrative forbearance without any notice?

Persons: servicer, —, MOHELA, servicers, forbearance, Scott Buchanan, Elizabeth Warren, Ed Markey, Chris Van Hollen, Richard Blumenthal, Scott Giles Organizations: Department, Service, Public, Student Loan, — Locations: forbearance, MOHELA, Sens

☆ 800,000 student-loan borrowers missed payments because their servicer failed to meet its 'basic obligation.' Here's what happens now.
▼ + stars: | 2023-11-02 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The Education Department withheld pay from MOHELA over failure to deliver on-time billing statements. AdvertisementAdvertisementPresident Joe Biden's Education Department revealed that a major student-loan company made errors with millions of borrowers' accounts. The Education Department instructed MOHELA to place all affected borrowers on forbearances until the issues are resolved. Borrowers enrolled in Public Service Loan Forgiveness or an income-driven repayment plan will have any month spent in forbearance counted toward their forgiveness progress. The Education Department said that it will continue to monitor servicers' performance "and ensure they are meeting their basic contractual obligations to the Department and to borrowers.

Persons: —, Joe Biden's, Miguel Cardona, MOHELA, Will, I'm, What's, servicers Organizations: Department, Service, Joe Biden's Education Department, MOHELA, Education Department, The Education Department, Federal Student, Federal Student Aid Locations: forbearance

A student loan is reported as an installment loan on your credit report and can affect your credit score. How to build credit with your student loanPracticing good student loan management can positively affect your credit score. Monitor your credit report — Regularly checking your credit report helps you spot inaccuracies and stay on top of your credit. Consolidate or refinance federal student loansYou can apply for student loan consolidation if you need help managing multiple federal student loans. How student loans affect credit scores frequently asked questionsHow much do student loans affect credit scores?

Persons: servicers, isn't, —, you've Organizations: Federal Locations: Federal

☆ Student-loan borrowers struggling with repayment should not be required to pay their debt until their account issues are resolved, 19 state attorneys general say
▼ + stars: | 2023-10-02 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

Pandemic relief for student-loan borrowers is officially over. State attorneys general said those borrowers shouldn't have to make payments until the issues are fixed. AdvertisementAdvertisementA group of state attorneys general don't think student-loan borrowers should have to pay off their loans while struggling to get issues with their balances resolved. Interest also started building on balances in September due to the debt ceiling bill Biden signed into law in June that codified the end of the student-loan payment pause. Over the past few months, borrowers have increasingly been struggling with their servicers as they began to prepare for repayment.

Persons: —, Joe Biden, Miguel Cardona, servicers, Biden, Education James Kvaal, MOHELA Organizations: Service, Education, Student Aid, Democratic, The Education Department

☆ Some student loan borrowers have extra time before payments restart. Here's why
▼ + stars: | 2023-09-21 | by ( Annie Nova | ) www.cnbc.com time to read: +1 min

Many people made their usual student loan payment in March 2020, before former president Donald Trump first announced the pause on federal student loan bills and interest accrual, he explained. Depending on when their loan servicer received those funds, it may have been considered an extra payment that has now pushed back their due date. You can contact your loan servicer or log in to StudentAid.gov to learn your exact due date, said higher education expert Mark Kantrowitz. The typical federal student loan bill is $350 a month. If you were enrolled in the standard 10-year repayment plan prior to Covid and still are, your monthly payment should not have changed.

Persons: Buchanan, Donald Trump, servicer, Mark Kantrowitz, they're, Kantrowitz, Grace Locations: StudentAid.gov

☆ Why a single mom is stuck paying her ex husband's student debt — and needs his permission to make any changes to her payments
▼ + stars: | 2023-09-17 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +9 min

Biden signed into law a bill allowing student-loan borrowers who combined balances with a spouse to separate their loans. They wouldn't owe payments, and if approved for administrative forbearance, their interest rates would be set to zero. Brigid, a 55-year-old borrower with spousal loans, told Insider she's experienced a similar dilemma. However, because of the strict nature of spousal loans, she would also have to meet the hardship requirements by, for example, also having cancer in order to receive the deferment. But she's been unable to receive administrative forbearance, and she's frustrated borrowers with spousal loans are blocked from opportunities federal borrowers are receiving.

Persons: Biden, Theresa, she's, Theresa —, —, Sen, Mark Warner, David Price, Joe Biden, Price, it's, That's, hasn't, servicer, Brigid, servicers, It's, they'll, Elizabeth Organizations: Service, Education Department, Federal Student Aid, Group, Family Education, forbearance Locations: Wall, Silicon, forbearance

☆ A millennial who's paid down $190,000 in student-loan debt shares the budget template he created and why it's effective: 'You're forced to see what's going on'
▼ + stars: | 2023-08-13 | by ( Kathleen Elkins | ) www.businessinsider.com time to read: +7 min

Ian Group has paid down $190,000 in student loans. After wrapping up law school with $190,000 worth of student loans, things didn't exactly play out as Ian Group imagined they would. Courtesy of Ian GroupGroup has two columns in this section: "estimated monthly income" and "actual monthly income." Again, Group has it set up in two columns: "estimated monthly expenses" and "actual monthly expenses." "It brings in your income, expenses, what you're saving and investing, and it gives you the net total," he explained.

Persons: Ian, I'm, he'd, he's, Roth Organizations: Group, overdrawing, Ian Group Locations: Florida

☆ 3 options for struggling student loan borrowers when payments restart
▼ + stars: | 2023-08-10 | by ( Annie Nova | ) www.cnbc.com time to read: +3 min

Jacob Wackerhausen | Istock | Getty ImagesWith other household debt on the rise, the restart of student loan payments in less than two months may cause financial hardship for many Americans. The pause on federal student loan payments is one of the last Covid pandemic-era relief measures still in effect, but the bills are expected to finally resume in October. If you're unemployed when student loan payments resume, you can request an unemployment deferment with your servicer. The maximum amount of time you can use an unemployment or hardship deferment is usually three years, per type. Kantrowitz provided an example: A $30,000 student loan with a 5% interest rate would increase by $1,500 a year under a forbearance.

Persons: Jacob Wackerhausen, Mark Kantrowitz, Kantrowitz, Betsy Mayotte, Biden Organizations: Istock, Deferments, Peace Corps, The, Student Loan Advisors Locations: Mayotte

☆ With college bills due soon, families should know the risks of private student loans
▼ + stars: | 2023-08-07 | by ( Annie Nova | ) www.cnbc.com time to read: +2 min

But, Kantrowitz said, "borrowing private loans may be a sign of overborrowing, so they should do so with caution." Scott Buchanan, executive director of the Student Loan Servicing Alliance, a trade group for federal and private lenders, said private student loans can fill the gap for those who've exhausted federal aid and scholarships. "We almost always advise against private loans," Mayotte said in an earlier interview. She also described severe terms private lenders may enforce. watch nowAs Mayotte pointed out, many private lenders require students to get a cosigner who is equally liable for the debt.

Persons: Carlo Prearo, Max, Kantrowitz, Scott Buchanan, Buchanan, Betsy Mayotte, there's Organizations: Istock, Getty, U.S . Department of Labor's, Student Loan, Alliance, The, Student Loan Advisors Locations: Mayotte

☆ Biden administration forgives $39 billion in student debt for more than 800,000 borrowers
▼ + stars: | 2023-07-14 | by ( Annie Nova | ) www.cnbc.com time to read: +1 min

President Joe Biden announces new actions on June 30, 2023 to protect borrowers after the Supreme Court struck down his student loan forgiveness plan. The relief is a result of fixes to the student loan system's income-driven repayment plans . The Biden administration announced on Friday it would automatically forgive $39 billion in student debt for 804,000 borrowers. To bring people over the line for forgiveness, the Biden administration counted payments for borrowers who'd paused their payments in certain deferments and forbearances and those who'd made partial or late payments. The announcement comes weeks after the Supreme Court struck down President Joe Biden's sweeping student loan forgiveness plan, which would have delivered relief to about 37 million people.

Persons: Joe Biden, Biden, Education Miguel Cardona, who'd, Joe Biden's Organizations: Education, The Education Department

☆ Borrowers brace for student loan bills to resume — '$600 a month, where is that going to come from?'
▼ + stars: | 2023-06-04 | by ( Annie Nova | ) www.cnbc.com time to read: +6 min

As a result of the policy, the average borrower likely saved around $15,000 in student loan payments, Kantrowitz said. ″[T]he one-time student loan debt relief program was intended to avoid" that problem, he added. Yet consumer advocates say the troubles for student loan borrowers are far from over. "Borrowers are not ready to resume payments," said Persis Yu, deputy executive director at the Student Borrower Protection Center. To be able to afford his student loan payment in September, Berlet plans to cut back on how much food he buys.

Persons: Donald Trump, Mark Kantrowitz, Kantrowitz, James Kvaal, Joe Biden's, Mark, Kvaal, Kevin McCarthy, Biden, McCarthy, Persis Yu, Yu, they'd, Paul, Berlet, he'll, Brooks, didn't, wasn't, Paul Berlet Organizations: Twitter, Student, Protection, Kantrowitz, Education Department, Pennsylvania Higher Education Assistance Agency, Granite State Locations: U.S, Pennsylvania, Granite, Wilmington , Delaware

☆ How borrowers can keep their student loan payments on hold once bills resume
▼ + stars: | 2023-03-29 | by ( Annie Nova | ) www.cnbc.com time to read: +4 min

watch nowThe Education Department in November said student bills would resume 60 days after the litigation over its student loan forgiveness plan resolves. If you're unemployed when student loan payments resume, you can request an unemployment deferment with your servicer. The maximum time you can use an unemployment or hardship deferment is usually three years per type. Forbearances also keep bills on holdStudent loan borrowers who don't qualify for a deferment may request a forbearance. Kantrowitz provided an example: A $30,000 student loan with a 5% interest rate would increase by $1,500 a year under a forbearance.

Around 40% of outstanding federal student loan debt is now taken on post-college for master's and PhD programs. The average student debt balance among parents was more than $35,000 in 2018-19, up from around $5,000 in the early 1990s. Meanwhile, the private student loan market has grown more than 70% over the last decade, according to the Student Borrower Protection Center. Americans now owe more in private student loans than they do for past-due medical debt or payday loans. Every year millions of new students are pumped into the student loan system while current borrowers struggle to exit it.

☆ What happens if the Supreme Court strikes down student loan forgiveness? Here are 3 predictions
▼ + stars: | 2023-01-29 | by ( Annie Nova | ) www.cnbc.com time to read: +3 min

Despite student loan borrowers being offered forbearances during previous natural disasters, Kvaal wrote, default rates still skyrocketed when payments resumed. ″[T]he one-time student loan debt relief program was intended to avoid" skyrocketing default rates, Kvaal added. "These student loan borrowers had the reasonable expectation and belief that they would not have to make additional payments on their federal student loans," Kvaal said. That law allows the Education Department to make modifications to federal student loan programs during national emergencies. 'A disastrous blow to Black Americans'The country's $1.7 trillion student loan crisis has hit Black Americans especially hard.

☆ Gen Zers are taking on more debt, roommates, and jobs as their economy gets worse and worse
▼ + stars: | 2022-12-04 | by ( Jacob Zinkula | ) www.businessinsider.com time to read: +7 min

Gen Zers are taking on credit-card debt — and missing their payments — at a rising rate. Amounts of credit-card debt and delinquency rates are on the rise, especially among 18- to 29-year-olds. But if a recession comes, Gen Zers could be among the hardest hit due to mounting debt, few savings, and vulnerability to layoffs. US credit-card debt overall rose $38 billion between July and September of this year, per the New York Fed. For older Gen Zers, the delinquency rate rose to over 6%, though still below the roughly 9% pre-pandemic rate.

☆ Gen Z's finances are already tanking, and we're not even in a recession yet
▼ + stars: | 2022-11-23 | by ( Jacob Zinkula | ) www.businessinsider.com time to read: +5 min

Credit card debt is on the rise, and Gen Z is missing payments at an increasing rate. If the US enters a recession, young Americans could be disproportionately impacted. Consequently, the personal savings rate rose to its highest level on record. That's because young Americans are among the individuals hardest hit by economic downturns. In 2020 for instance, Gen Z's unemployment rate rose from 8.0% in February 2020 to 26.9% in April, while millennials' increased from 4.0% to 14.3%.

☆ Biden administration warns of 'historically large increase' in student loan defaults without debt forgiveness
▼ + stars: | 2022-11-16 | by ( Annie Nova | ) www.cnbc.com time to read: +2 min

Student loan borrowers gather near The White House to tell President Biden to cancel student debt on May 12, 2020. Student loans plagued with problems before CovidEven before the pandemic, when the U.S. economy was enjoying one of its healthiest periods in history, problems plagued the federal student loan system. watch nowFederal student loan payments have been on pause since March 2020, when the coronavirus pandemic first hit the U.S. and crippled the economy. Despite offering student loan borrowers forbearances during previous natural disasters, default rates still skyrocketed, Kvaal said in the filing. "[T]he one-time student loan debt relief program was intended to avoid" that problem, he added.

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