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☆ Student-loan borrowers are about to face more hurdles after a major company reduced its call center hours — and laid off 550 more employees
▼ + stars: | 2023-04-10 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +5 min

The Education Department modified student-loan company Nelnet's contract, per SEC documents. The changes included reduced call center hours, contributing to Nelnet laying off 550 employees. It also allows Nelnet to have a higher percentage of borrowers hang up without receiving help. At the end of March, student-loan company Nelnet announced a series of changes to its contract implemented by the Education Department. But it's a critical year for student-loan borrowers, and Nelnet is just one sign that they're facing a rocky road ahead.

☆ Why a millennial with $134,000 in student debt hasn't made payments while living abroad for nearly a decade
▼ + stars: | 2023-04-09 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +6 min

Todd Squitieri, 37, has $134,000 in student debt he's placed in forbearance for nearly a decade. He moved abroad and says he's much happier, but he couldn't leave the student debt behind. Even with $134,000 in student debt hanging over his head. But as Squitieri was traveling and not making payments on his student loans, the balance was growing, and leaving the country doesn't mean he can leave his student debt behind. Biden's student-loan forgiveness is 'token service'There could be relief on the horizon for millions of borrowers with federal student debt.

☆ A mom took out over $77,000 in student loans to send her son with autism to college. He got his debt wiped out — but she's still paying hers off with no end in sight.
▼ + stars: | 2023-04-08 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +6 min

Marsha Wipperman, 59, took on parent PLUS student loans so her son with autism could attend college. "I'm going pay it. So I just signed away on my parents loans because that's what a parent does." Marsha Wipperman took on $77,000 in PLUS loans for her son. 'I've done 100% what I needed to do at that time'Parent PLUS loans gave Wipperman's son the opportunity to attend college, and she wouldn't have done it any other way.

☆ Meet a teacher who paid his student loans for 6 more years than he needed to qualify for debt cancellation. Now he can't get his money back.
▼ + stars: | 2023-04-02 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +8 min

He contacted his servicer, MOHELA, in August to get refunded on those payments, but hasn't had any luck. Currence, 41, took on about $13,000 in student loans for his Bachelor's degree in 2005, and he had nearly paid it all off by the time he took on another $15,000 in loans in 2018 for his Master's degree. Given his career in public service, Currence wanted to take advantage of the Public Service Loan Forgiveness (PSLF) program, which forgives student debt for government and nonprofit workers after ten years of qualifying payments. Currence jumped at the opportunity to consolidate his loans into federal direct loans under student-loan company MOHELA to qualify for debt relief. They told him he could then consolidate his loans to get his remaining balance wiped out under PSLF, he said.

☆ Republicans want to cut $1 trillion in spending — and instead of introducing 1 bill, they've introduced 500 to do just that
▼ + stars: | 2023-03-30 | by ( Ayelet Sheffey | Juliana Kaplan | ) www.businessinsider.com time to read: +4 min

GOP lawmakers published over 500 bills on different areas in which they want to cut spending. It comes as Biden has been urging Republicans to put forth a concrete budget. GOP budget chair Jodey Arrington said the budget could take months, and the primary focus should be raising the debt ceiling. Republican lawmakers just made their latest move in the ongoing drama to raise the debt ceiling and cut spending. Now, Republicans have some ideas — or rather, over 500 proposed bills for limiting funding to a slew of federal government programs and agencies.

☆ 453,000 student-loan borrowers in public service have gotten their debt wiped out over the past year — and more are still to come, Biden's Education Department says
▼ + stars: | 2023-03-29 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

453,000 student-loan borrowers have gotten debt relief through the PSLF waiver, the Education Department said. Biden's Education Department announced in October 2021 temporary reforms for PSLF, a program that allows government and nonprofit workers to receive loan forgiveness after ten years of qualifying payments. While many borrowers are still waiting for their applications to be processed, the Education Department also announced permanent reforms to PSLF in October following the waiver's expiration. "Higher education should lift you up, not weigh you down," Education Secretary Miguel Cardona wrote on Twitter in January. "Thanks to changes we've made to the Public Service Loan Forgiveness program, everyday Americans can reach dreams they put off for far too long.

☆ The GOP just tried the fast-track route to block Biden's student-debt relief. Here's why it probably won't work.
▼ + stars: | 2023-03-26 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +7 min

But the debt relief still faces challenges ahead as the Supreme Court decides its legality. Chip Somodevilla/Getty ImagesOther roadblocks student-debt relief could faceA CRA resolution might not work, but Republicans have still put forth other legislation. "We will continue to fight this cruel Republican attempt to end student debt relief with everything we have," he said. Amid potential challenges, Biden's administration has not relented in its confidence student-debt relief will reach borrowers this year. "Our student debt relief plan is necessary in the wake of the pandemic," Education Secretary Miguel Cardona wrote on Twitter.

☆ Biden's Education Department just pushed back the deadline for student-loan borrowers to see debt relief through a one-time reform
▼ + stars: | 2023-03-20 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The Education Department announced a one-time account adjustment for borrowers in PSLF and income-driven repayment plans. It comes as Federal Student Aid did not receive any additional funding to implement reforms to a series of debt relief programs. PSLF promises debt relief for government and nonprofit workers after ten years of qualifying payments, and IDR plans give borrowers affordable monthly payments based on their income with the promise of debt relief after at least 20 years. According to new guidance on Federal Student Aid's website, though, the deadline for borrowers to receive relief through the account adjustment got pushed back. All borrowers can do right now is wait for updates from the department regarding the implementation of reforms — and of course, the Supreme Court's decision on broad debt relief.

☆ Millions of student-loan borrowers will experience 'devastating' delays in debt relief if a GOP proposal to cut spending goes through, Biden's Education Secretary says
▼ + stars: | 2023-03-20 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

Rep. Rosa DeLauro asked all federal agency heads how GOP spending cut proposals would impact them. Miguel Cardona outlining the "devastating" impact the cuts would have on student-loan borrowers. He said the cuts would delay student-debt relief and make it even harder to get customer service help. Education Secretary Miguel Cardona, in his response, elaborated on the "devastating effects" the GOP proposal would have on students and parents who rely on financial aid — especially student-loan borrowers. But the agency already has a lot on its plate with minimal resources, given Congress approved a budget last year that did not increase Federal Student Aid's funding.

☆ A student-loan borrower was promised a $5,000 refund on payments after Biden's broad debt relief. Months later, she's still waiting — and no one is picking up the phone to help.
▼ + stars: | 2023-03-19 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +7 min

Roxanne Dougherty, 31, is waiting for a $5,000 refund on her student-loan payments. The Education Department directed Insider to guidance on refunds posted on Federal Student Aid's website. "No one is taking the time to help me or to listen to me when it comes to MOHELA," Dougherty said. "It just seems like there's something in it for them to not help," Dougherty said. Are you still waiting for a refund on your student-loan payments?

☆ College acceptance and financial aid letters are going out — how to understand your offers
▼ + stars: | 2023-03-18 | by ( Jessica Dickler | ) www.cnbc.com time to read: +5 min

watch nowUnderstanding the college financial aid letterOne of the first things to understand when assessing aid letters is the formula colleges use to come up with the expected family contribution. Kalman Chany financial aid consultantFurther, not all colleges include both direct and indirect expenses in the total "cost of attendance." As a rule of thumb, add an extra $4,000 for those indirect costs if they are not included in the aid offer, Chany said. Differentiate free vs. borrowed moneyIn most award letters, there are often several financial aid options, including grants, scholarships, work-study opportunities and student loans. If your circumstances are now different, that should be brought to the financial aid office's attention with documentation.

☆ Student-loan borrowers just got an added layer of protection from schools that take advantage of them 'to make a quick buck'
▼ + stars: | 2023-03-15 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +3 min

It will be using secret shoppers to identify misleading behavior that push students to take on debt. Findings from secret shopping will be used as evidence to support any investigation the department will conduct into a school that could be engaging in predatory behavior. "Secret shopping is another tool in FSA's toolbox as we expand our oversight work to hold predatory schools accountable," FSA Director Richard Cordray said in a statement. "Our focus—as always—is to ensure that students, borrowers, families, and taxpayers are not being preyed upon to make a quick buck." "Consequences for schools that violate these prohibitions could include the termination or limitation of a school's participation in the Department's federal student aid programs," Kristen Donoughue, FSA's chief enforcement officer, wrote in the blog.

☆ Biden wants to 'better support' student-loan borrowers who are returning to repayment. It's further confirmation the payment pause will end this year.
▼ + stars: | 2023-03-09 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

It included increased funding for the Federal Student Aid office to help the return to repayment this year. It comes after SoFi filed a lawsuit to end the payment pause and throw borrowers back into repayment. This budget release also comes in a time of significant uncertainty for student-loan borrowers. "This additional funding is needed to provide better support to student loan borrowers, especially as they return to repayment," the budget said. "The Department will continue to fight to deliver relief to borrowers, provide a smooth path to repayment, and protect borrowers from industry and special interests."

☆ How universities became giant piggy banks for hedge-fund billionaires
▼ + stars: | 2023-03-08 | by ( Catherine Liu | ) www.businessinsider.com time to read: +14 min

The move also marked the beginning of a new way to manage endowment funds. The arrangement has been a boon for the hedge-fund managers who received university endowment cash, but the benefits for the schools are trickier to parse. As Eaton put it in his book, universities directed funds to "wherever those allocations would generate the largest further investment returns." Eaton estimated in 2017 that tax breaks for university endowments cost federal coffers up to $19 billion a year. As the influence of billionaires and hedge-fund managers has grown, universities have moved further away from their ultimate goal: educating people.

☆ Canceling student debt for millions of borrowers 'cheated by for-profit colleges' isn't enough, Biden's Education Department says — it's time for the top executives to pay up
▼ + stars: | 2023-03-06 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The Education Department released new guidance to hold executives of for-profit colleges financially liable for unpaid costs to the government. When a school shuts down or is accused of fraud, taxpayers or students often pay the costs. Last week, the Education Department released new guidance on implementing the Education Secretary's authority to hold executives of private colleges financially liable for the cost of unpaid debts defrauded students took on. "The Biden-Harris Administration is canceling the loans of more than a million borrowers cheated by for-profit colleges. But too often, the owners and executives of these colleges escape liability," Under Secretary of Education James Kvaal said in a statement.

☆ 3 strategies can get you more financial aid for college
▼ + stars: | 2023-02-27 | by ( Jessica Dickler | ) www.cnbc.com time to read: +3 min

Apply for financial aidIn ordinary years, high school graduates miss out on billions in federal grants because they don't apply for financial aid. Even now, many families haven't applied for financial aid. Financial aid is determined by income information that is not necessarily up to date. If your circumstances are now different, that should be brought to the financial aid office's attention with documentation. If the financial aid package from another comparable school was better, that is also worth documenting in an appeal.

☆ We just got a fresh sign that Biden's plan to give millions of student-loan borrowers who fell behind on payments a shot at debt relief is working
▼ + stars: | 2023-02-16 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The New York Fed found that $34 billion in delinquent student loans were marked current in the last quarter of 2022. That's thanks to Biden's "Fresh Start" plan, which aimed to restore defaulted borrowers to good standing. The plan will remain in place for a year after student-loan payments resume. In fact, student-loan borrowers who were previously behind on their payments — or delinquent — saw their conditions improve in the last quarter thank to President Joe Biden's "Fresh Start" plan. Student-loan payments are currently set to resume 60 days after June 30, or 60 days after the lawsuits blocking Biden's broad debt relief are resolved, whichever happens first.

☆ A GOP lawmaker wrote a one-sentence bill to abolish the Department of Education. His reasoning doesn't address student loans, grants, or any of the major things the department does.
▼ + stars: | 2023-02-15 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +5 min

The CBO previously said that getting rid of an agency would only cut spending if its programs were eliminated, as well. Last week, Kentucky Rep. Thomas Massie introduced a bill to abolish the Education Department, and it's a short, one-sentence read: "The Department of Education shall terminate on December 31, 2022." Congress recently approved a $1.7 trillion budget for the government, including $79.6 billion for the Education Department. Former President Donald Trump also said in 2015 that he'd consider getting rid of the department, saying it could be cut "way, way, way down." Reagan's efforts were clearly unsuccessful, given both of those agencies are operating at full capacity today, and millions of Americans are now relying on the Education Department's Federal Student Aid Office to facilitate the disbursement of federal student loans and grants.

☆ It just got easier for defrauded student-loan borrowers to apply for debt cancellation
▼ + stars: | 2023-02-06 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

The Education Department launched a new website to help defrauded student-loan borrowers apply for debt relief. While this website may ease the application process, many defrauded borrowers continue to wait for relief. Approval of those claims means the department will discharge any debt the student took out to attend the school in question. It includes information on reasons borrowers apply for borrower defense, what type of misconduct qualifies for debt relief, specific details on information borrowers should include in their claims, and what happens after a borrower applies. A section of Federal Student Aid's new borrower defense website detailing information to include in a claim.

☆ Why Biden's plan to make monthly student-loan payments cheaper could end up sticking borrowers with the same repayment struggles they've had for decades
▼ + stars: | 2023-02-04 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +8 min

For years, income-driven repayment plans for student-loan borrowers were not working as intended. That's why Biden introduced a proposal to reform those plans and make monthly payments cheaper. Angel said they were advised by a customer service representative at a student-loan company to stay in school to defer the loan payments. But after so many years of failures with IDR plans, Chingos said he's concerned not much will change. According to NPR, three student-loan companies weren't tracking the payments borrowers were making under the plan, and low-income borrowers who were making $0 monthly payments were hurt the most.

☆ Transitioning millions of student-loan borrowers back into repayment this year will be a 'huge undertaking,' Biden's Education Department says
▼ + stars: | 2023-01-26 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +4 min

Federal Student Aid's 2022 annual report said that resuming student-loan payments this year will be a "huge undertaking." It cited the unprecedented nature of Biden's broad debt relief and extensions of the payment pause. The agency said it will improve customer service, but borrowers are continuing to struggle with their loan servicers. But it also noted changes that came from Biden's announcement in August to cancel up to $20,000 in student debt for federal borrowers making under $125,000 a year. Insider previously reported on hours-long hold times some borrowers were experiencing when trying to get help from MOHELA, a company currently involved in one of the lawsuits seeking to block Biden's broad debt relief.

The Biden administration has proposed changes that could dramatically lower monthly student loan payments. The plan calculates monthly payments based on a borrower's discretionary income. Insider's Featured Student Loan Refinance Companies SoFi Student Loan RefinancingSplash Financial Student Loan RefinancingEarnest Student Loan Refinancing Chevron icon It indicates an expandable section or menu, or sometimes previous / next navigation options. APR Variable: 4.49% - 8.99%, Fixed: 4.49% - 8.99% Editor's Rating 4.5/5 A five pointed star A five pointed star A five pointed star A five pointed star A five pointed star APR Variable: 3.99% - 8.99% with AutoPay, Fixed: 4.39% - 8.99% with AutoPay Editor's Rating 3.5/5 A five pointed star A five pointed star A five pointed star A five pointed star A five pointed star APR Actual rate and available repayment terms will vary based on your income. According to the Education Data Initiative, half of student loan borrowers still owe $20,000 each on outstanding loan balances after 20 years of entering school.

☆ Meet a 52-year-old who has struggled to repay their $480,000 in student debt on income-driven plans and has pushed off retirement: 'This is an albatross around my neck for the rest of my life'
▼ + stars: | 2023-01-22 | by ( Ayelet Sheffey | ) www.businessinsider.com time to read: +7 min

Angel, a 52-year-old student-loan borrower, has $480,000 in student debt. Their debt has surged due to payments on income-driven repayment plans and ballooning interest. Biden announced reforms to those repayment plans, but it's unclear how they will be implemented. "And I know that that's a concern for a lot of people I know with student loans." "If education is really about us being better contributors to society, then why are they charging interest on the student loans?"

☆ How Charlie Javice's Frank Sale to JP Morgan Wound up in Allegations of Fraud
▼ + stars: | 2023-01-21 | by ( Katherine Long | Jack Newsham | ) www.businessinsider.com time to read: +21 min

Her financial aid startup, Frank, was featured in the New York Times, CNBC and Wall Street Journal. After leaving the University of Pennsylvania's Wharton business school, Javice traded on her reputation, bolstered by glowing profiles, as a successful entrepreneur. In a 2018 interview with Insider, Javice claimed Frank secured an average of $28,000 for its users, and was helping students get "thousands off their tuition." "Charlie's first company fizzled after 18 months, so after losing all her investors' money, she convinced every one of them to fund her next company, Frank." At Frank, Javice admitted she sometimes painted a more positive picture of the company's health than was supported by the facts.

☆ I borrowed $50,000 to pay for college 10 years ago — now I owe double. The interest fees are screwing everyone over.
▼ + stars: | 2023-01-21 | by ( Robin Madell | ) www.businessinsider.com time to read: +6 min

Lisa Sass, 31, took out $50,000 in private student loans to pay for college. At 31 years old, I never thought I'd be nearly $100,000 in debt — and that's just for student loans. Paying half allows me to afford living expenses and other bills, but my student-loan payments only cover the interest. I still owe $95,576 in loans, and it sucks that private loans were left out of President Joe Biden's forgiveness program. I think loans need to get repaid, but I don't think interest rates should be as high as they are.

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