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☆ 3 signs Biden's Education Department has not 'efficiently or effectively' taken steps to overhaul the student-loan repayment system, according to the inspector general
▼ + stars: | 2023-01-19 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The Education Department plans to revamp the student-loan servicing system. But a report from the Inspector General found it has not been preparing to do so effectively. Last week, the Education Department's Office of Inspector General released a report analyzing Federal Student Aid's (FSA) efforts to transition the current repayment system to a new one, known as Next Generation (Next Gen) Loan Servicing. Additionally, it recommends that FSA develop a policy that requires a budget request be completed and approved prior to moving forward with any changes to the student-loan servicing system. The exact timeline for when borrowers will experience the revamped student-loan servicing system is unclear at this point, especially as the administration is working to implement other significant changes.

☆ What's next for Goldman following deep cuts and organization overhaul
▼ + stars: | 2023-01-17 | by ( Dan Defrancesco | ) www.businessinsider.com time to read: +5 min

On tap we've got stories on JPMorgan's Jamie Dimon fielding questions about the bank's acquisition strategy, another bank plans to make cuts, and fast food options that won't completely crush your diet. On Wednesday the bank conducted a majority of its cuts, reducing its global workforce by about 6.5%. A few days later, on Friday, the bank reported losses of more than $3 billion since 2020 in the unit that houses the bank's consumer lending business. Meanwhile, some of the recently axed Goldman employees have been left in the dark on what's next for them, according to reporting from Hayley and Emmalyse Brownstein. Here are some fast food options that won't completely wreck your diet.

☆ What student-loan borrowers should know about Biden's new debt relief proposals — and why advocates argue they're not enough
▼ + stars: | 2023-01-16 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +7 min

Biden proposed reforms to income-driven repayment plans for student-loan borrowers. "Today the Biden-Harris administration is proposing historic changes that would make student loan repayment more affordable and manageable than ever before," Education Secretary Miguel Cardona said in a statement. Here's what you need to know about these proposed reforms, and why some advocates are still pushing for further relief. This revision mean that the department will also be phasing out other versions of income-driven repayment plans. If you have a federal graduate or undergraduate student loan, who will be eligible for these reforms.

☆ Frank, the college loan start-up JPMorgan is suing for fraud, was warned by the FTC for misleading students about Covid relief money
▼ + stars: | 2023-01-13 | by ( Katherine Long | ) www.businessinsider.com time to read: +4 min

JP Morgan Chase has accused the student loan platform Frank and its founder Charlie Javice of inventing millions of fake customers to juice its value. In 2020, the Federal Trade Commission warned Frank that it "may be unlawfully misleading consumers" about student COVID relief. The company promised students help accessing the grant money, but all Frank was doing was generating a form letter students could send to university administrators. "We are concerned that Frank is creating false hope and confusion for students while contributing to unnecessary extra work for financial aid administrators," the representatives wrote. The advance wouldn't need to be paid back until "your aid comes in," the company wrote on its website.

☆ JPMorgan says college-planning firm it bought lied about its scale. Consumers may have been misled, too
▼ + stars: | 2023-01-13 | by ( Annie Nova | ) www.cnbc.com time to read: +2 min

watch nowIn response, the FTC sent a warning letter to Frank, pointing out a number of claims on its website could be "unlawfully misleading consumers." Besides the problems flagged by government officials, higher education expert Mark Kantrowitz said he noticed other questionable claims made by Frank. At one point, the company said it could complete people's Free Application for Federal Student Aid, or FAFSA, in just four minutes. "If it's too good to be true, it probably is," Kantrowitz said. Student loan, financial aid help is available for free

☆ President Biden just announced updates to student loan repayment—here's what borrowers need to know
▼ + stars: | 2023-01-12 | by ( Kamaron Mcnair | ) www.cnbc.com time to read: +4 min

The Biden Administration released details this week on its plan to overhaul the current income-driven repayment plan known as Revised Pay As You Earn plan (REPAYE) for federal student loan borrowers. All student borrowers with direct federal loans (not parent PLUS loans) are eligible for REPAYE repayment plans. The change would also stop interest from accruing on balances while borrowers qualify for $0 monthly payments. No interest accumulation while making regular paymentsUnder the current REPAYE plan, sometimes borrowers' monthly payments are lower than the interest accrued on the loan. Those who borrowed $12,000 or less would be eligible for loan forgiveness after 10 years of monthly payments.

☆ Before JPMorgan accused Charlie Javice of inventing millions of fake customers, the Frank founder settled with the federal government over accusations she was misleading students
▼ + stars: | 2023-01-12 | by ( Katherine Long | ) www.businessinsider.com time to read: +5 min

Visitors to Frank's website could get the mistaken impression that the company was affiliated with the federal government, the Department of Education said in 2017. The Department argued that Frank's website was "likely to confuse consumers." The Department stated in a cease and desist letter that Frank could be misleading applicants looking for the government's official FAFSA website. On social media and elsewhere, Frank sometimes referred to the form as "Frank's FAFSA," according to the settlement. In numerous media interviews, including with Insider, Javice has cast herself as a mold-breaking entrepreneur.

WASHINGTON, Jan 4 (Reuters) - The U.S. Justice Department late on Wednesday filed a brief with the Supreme Court defending President Joe Biden's plan to cancel billions of dollars in federal student loans, arguing that two cases lacked standing to challenge the debt relief. Biden in August said the U.S. government would forgive up to $10,000 in student loan debt for borrowers making less than $125,000 a year, or $250,000 for married couples. Students who received Pell Grants to benefit lower-income college students would have up to $20,000 of their debt canceled under the plan. In fact, the Justice Department said, the HEROES Act expressly exempted the department from notice and comment procedures. Over 16 million borrowers have already been approved for debt relief and millions more have applied.

☆ 4 new ways to avoid a tax penalty for early individual retirement account withdrawals
▼ + stars: | 2022-12-28 | by ( Greg Iacurci | ) www.cnbc.com time to read: +9 min

New exceptions to the 10% tax penaltySavers generally incur a 10% tax penalty if they withdraw money from a retirement account before age 59½. The following list outlines rules in the new legislative package that waive the 10% early withdrawal penalty for IRA owners. Terminal illness A terminally ill person wouldn't be penalized for withdrawing retirement funds before age 59½. Disability Certain disabled retirement savers under age 59½ aren't beholden to the tax penalty. IRS levy You won't incur a penalty if the distribution results from an IRS tax levy (i.e., if the IRS takes your retirement funds to satisfy a tax debt).

☆ Meet a 37-year-old with $108,100 in student debt who lives in a school bus because rent is unaffordable: 'Student-loan debt is by far my biggest regret'
▼ + stars: | 2022-12-26 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +6 min

Nick Crocker, 37, is living in a school bus he built out with his fiancée in Portland, Oregon. Crocker said his student debt is his "biggest regret" and wishes he had gone to trade school. With the majority of Crocker's debt being private loans, Biden's relief won't make a significant dent for him and about 3 million other borrowers with private loans. He says he wishes he'd known the high, life-long costs of higher education when he was in high school. "So we're living in a 120-square-foot school bus, and while it's been a great way for us to save the money, it's cramped.

☆ Here are 10 ways to avoid the early withdrawal penalty for individual retirement accounts
▼ + stars: | 2022-12-22 | by ( Greg Iacurci | ) www.cnbc.com time to read: +7 min

But there are some situations in which account owners — both those with savings in individual retirement accounts and workplace plans like a 401(k) — can access that money early without penalty. "The worst thing you can do is take from your retirement account before its intended purpose, because then what will be for your retirement?" The list below outlines situations in which IRA owners wouldn't owe the 10% early withdrawal penalty. watch nowThe IRA withdrawal can be used for you, a spouse or your child, among other qualifying family members. The IRA withdrawal must also occur the year you received unemployment, or in the following year.

☆ Pell Grants could rise to a maximum $7,395 next year, in the biggest increase in over a decade
▼ + stars: | 2022-12-21 | by ( Annie Nova | ) www.cnbc.com time to read: +3 min

Olelole | E+ | Getty ImagesAs part of its massive $1.7 trillion spending package for 2023, Congress is planning to up the maximum annual Pell Grant award to $7,395 — a $500 increase from this school year. President Joe Biden had previously called to raise the Pell Grant by even more, to a maximum allotment of $8,670 in 2023, and has said he wants to see the payments double by 2029. Pell Grants are one of the biggest sources of financial aid available to college students, and more than 6 million students received them in 2020. Each year, Congress decides how much to allocate to the maximum Pell Grant, and in some years it has reduced the payment. There's a limit to how many Pell Grants you can getCollege students typically can receive the grant for up to six years.

Student loan debt has become such an issue that the Biden Administration has been attempting to cancel up to $20,000 in student debt per eligible borrower and has continually extended the student loan repayment pause. Ways employers are currently assisting with student debt management"Employers are increasingly offering student loan contribution plans as a direct way to help borrowers pay down student loan debt," Scruggs says. How other employers can help employees manage student loan debtOne of the simplest and most affordable ways employers can help employees is to share information on what employees need to know about their student loans. "There are many ways to help employees manage and pay down student loan debt. However, note that if you refinance federal student loans you'll lose federal protections, like the current student loan payment freeze and potential student loan forgiveness.

☆ The government's new spending bill has protections for student-loan borrowers dealing with bad behavior by companies that manage their debt
▼ + stars: | 2022-12-20 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The new government spending bill did not increase funding for the Federal Student Aid office. But it did include language on holding student-loan companies accountable for misleading borrowers. On Monday, the House appropriations committee released the text of its $1.7 trillion government spending bill for the upcoming fiscal year. But given the lack of increased funding in the spending bill, its likely the implementation of that system will be delayed. Borrowers have reported a number of issues with student-loan companies over the past year.

☆ This 529 savings plan myth is making college pricier for families, consultant says: 'It's candidly, blatantly not true'
▼ + stars: | 2022-12-14 | by ( Kate Dore | Cfp | ) www.cnbc.com time to read: +1 min

SEATTLE — For many families, paying for college is a financial burden, and experts say education-funding myths may be adding to the student loan debt crisis. "There's often this perception that somehow people are being penalized for saving for college," said Cozy Wittman, national education and partnerships speaker with College Inside Track. Parent-owned 529 college savings plans are assessed at 5.64% when filing the Free Application for Federal Student Aid, known as the FAFSA, she said, speaking at the Financial Planning Association's annual conference on Tuesday. That means for every $10,000 of 529 plan savings, roughly $564 counts toward the parents' expected family contribution, potentially reducing financial aid by roughly the same amount, according to the College Savings Plans Network. The average 529 account value was $30,287 in 2021, the College Savings Plans Network reported.

☆ Some students are graduating college with 'unmanageable' debt — but it's not their fault, a government watchdog finds
▼ + stars: | 2022-12-06 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +5 min

Specifically, 91% of colleges are understating the net price, which can mislead students into taking on more debt. Current federal law does not require colleges to follow standards when presenting financial aid packages. Not counting student loans in the total cost could present a misleading picture of how expensive a degree would be, pushing students further into debt. "Colleges that estimate the net price by subtracting student loans from the cost of attendance do not present the full net price because students generally must repay their student loans eventually," the report said. "Additionally, subtracting student loans in the net price estimate presents loans as the default method for paying for college, potentially encouraging students to borrow more than they otherwise would."

☆ Student-loan borrowers who are behind on payments can avoid facing collections for one year after the payment pause ends. Here's how Biden's Education Department wants to make sure companies holding t
▼ + stars: | 2022-12-05 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +3 min

introduced its "Fresh Start" plan, which would help defaulted student-loan borrowers. Last week, the department released updated guidance to the agencies that hold those borrowers' debt. Borrowers will have one year after payments resume to make use of the program. According to Cordray's guidance, the agencies that hold defaulted student-loan borrowers' debt will be required to suspend collection attempts for borrowers in the Fresh Start program for a year following the end of the payment pause. Along with guidance to the guaranty agencies, borrowers in default will also need to take action to return to good standing.

☆ Biden's student debt forgiveness waits on Supreme Court—here's when borrowers may have to start paying again
▼ + stars: | 2022-12-02 | by ( Kamaron Mcnair | ) www.cnbc.com time to read: +2 min

The Supreme Court on Thursday declined to greenlight President Joe Biden's sweeping student debt forgiveness plan. In November, the Biden administration issued another extension of the federal student loan payment pause in light of the legal challenges delaying debt forgiveness. The current order does not give any additional breathing room in the event the Supreme Court rules against the Biden administration. The administration has not revealed a back-up plan if the Supreme Court does not allow debt forgiveness to proceed. Don't miss: Will student loan forgiveness make inflation worse?

☆ Student-loan borrowers should not be 'scammed out of an education and into a mountain of debt,' 3 Democratic lawmakers say. Here's how their new bill would help prevent that.
▼ + stars: | 2022-12-01 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

Three Democratic lawmakers introduced a bill to increase oversight of for-profit colleges. The bill would create a committee to oversee the industry and monitor potential predatory behavior. For-profit schools have come under scrutiny for loading students up with debt they cannot pay off. "We cannot let this industry continue to take advantage of students without proper federal oversight." Along with Democratic lawmakers, President Joe Biden's Education Department has taken steps to increase oversight over the for-profit industry.

☆ Even University Presidents Lose Their Minds When Their Teens Apply to College
▼ + stars: | 2022-11-29 | by ( Melissa Korn | ) www.wsj.com time to read: 1 min

Richard Holz filled out the Free Application for Federal Student Aid, known as the Fafsa, for his two daughters. Like many parents, he found the process baffling. “It’s like they want to know your shoe size,” says Dr. Holz. “They want to know so much, and why is it relevant or pertinent?” he adds. “It should be so much easier.”

☆ 3 steps that would help 'cure the disease' of the student-debt crisis after Biden's one-time relief, according to experts
▼ + stars: | 2022-11-24 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +9 min

"We really need to figure out a way to cure the disease and fix the problem," Levine said. "The rising cost of college can put valuable options out of reach for students who need them the most. Grants, when based on financial need, are a key step toward a more equitable system." Biden noted his plan was a "one-time" relief measure and borrowers would not see another broad loan forgiveness action during his term. While its implications are significant — the relief would wipe out the entire balances for 20 million borrowers — it's currently blocked.

☆ Applications for student loan forgiveness no longer accepted
▼ + stars: | 2022-11-12 | by ( The Associated Press | ) www.nbcnews.com time to read: +2 min

WASHINGTON — The Biden administration is no longer accepting applications for student loan forgiveness after a second federal court shut down the program. “Courts have issued orders blocking our student debt relief program,” the Education Department said on its federal student aid website. Student loan forgiveness is likely to end up before the Supreme Court. People with student loan debt have not been required to make payments during the pandemic. As for loan forgiveness, the Education Department said on its website that it would hold on to the applications for those who have already applied.

☆ Families can get Pell Grants of up to $6,895 to help with college costs. Here's what you need to know
▼ + stars: | 2022-11-02 | by ( Annie Nova | ) www.cnbc.com time to read: +3 min

And it goes further for those who received a Pell Grant in college, a type of aid available to low-income families, by clearing as much as $20,000 from their student debt balance. The federal Pell Grant program, signed into law in 1965, is one of the largest sources of financial aid available to college students. Here's what families need to know about Pell Grants. There's a limit to how many Pell Grants you can getCollege students typically can receive the grant for up to six years. "The student can then use the money to pay for other college costs, such as textbooks," he said.

☆ Education Department overhauls federal student loan system, aiming to make it 'simpler, fairer and more accountable'
▼ + stars: | 2022-10-31 | by ( Annie Nova | ) www.cnbc.com time to read: +2 min

The U.S. Department of Education announced on Monday sweeping new changes to the federal student loan system, including additional consumer protections for borrowers and limits on the amount of interest that can accrue on the debt. "Today is a monumental step forward in the Biden-Harris team's efforts to fix a broken student loan system and build one that's simpler, fairer, and more accountable to borrowers," said U.S. Secretary of Education Miguel Cardona, in a statement. The Biden administration will also curb the practice of interest capitalization — in which unpaid interest is added to the borrower's principal. The Public Service Loan Forgiveness Program, which allows public servants and those who work for certain nonprofits to get their debt canceled after a decade, will also get an overhaul. Months that previously didn't qualify toward a borrowers' debt relief, including those when they were in a economic hardship deferment, will be counted.

Many rules require banks to bulk up on treasuries. Two other bankers said the executives expressed concerns over longer-term "systemic risks" due to the level of their bond holdings. Parliament, dominated by the AKP and nationalist allies, is debating next year's budget including record spending of 258.4 billion lira on social aid. VULNERABLE TO REVERSALThe series of rules increased the central bank's authority over the government debt, credit and loan markets, bankers say. Akbank's (AKBNK.IS) Q3 net profit was 17.07 billion lira versus 3.21 billion lira year ago.

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