With student loan debt in the U.S. now well beyond $1 trillion, everyone seems eager to get into the debt-reduction business. Some cities will pay down your debt if you move there, while a growing number of employers are making loan payment contributions part of the benefits package. Now some financial institutions are dangling the debt-reduction carrot in front of potential customers — but should you bite? [More]
As the fallout continues from the collapse of Corinthian Colleges Inc. — former operator of Everest University, WyoTech, and Heald College — the Department of Education is trying to sort through nearly 20,000 loan-forgiveness requests from former students who claim that CCI and other for-profit colleges misled them into taking out huge student loans. [More]
When Corinthian Colleges Inc. collapsed, leaving thousands of students in the lurch with student loan debt and credits that they didn’t know would be usable at other schools, they were generally unable to sue the failed for-profit educator because the students had unwittingly signed away their right to a jury trial or class action. CCI wasn’t the only for-profit operator with this anti-consumer practice, and a new report tries to get a grasp on the scope of the problem. [More]
Under the law, borrowers who are permanently disabled are eligible to have their federal student loans discharged. While the government has taken steps in the past to make the process more streamlined for consumers, the Department of Education will now proactively seek out eligible borrowers. [More]
Federal law bars debt relief services from receiving upfront fees before they’ve even renegotiated a single debt for a customer. But one student loan debt relief operation allegedly took in nearly $3.6 million in illegal fees, only to enroll borrowers in programs that are already available for free.
For years, parents have assisted their children in shouldering the increasingly high cost of college: co-signing private student loans, taking part in federal loan programs, and saving for years to contribute. Private student loan lenders have been offering parent loans as an alternative for several years. And now the country’s largest lender plans to enter the fray with its own version. [More]
For nearly a year, advocates and lawmakers have shared their dissatisfaction with the Department of Education’s pace and complicated process on discharging the student loan debt for students of now-defunct for-profit chain Corinthian Colleges. Today, the Department is expected to clear a path for debt relief for these students after determining that state investigations into the schools found enough proof that the company widely misled students about their futures if they attended the schools. [More]
Any help graduates can get when it comes to repaying their mountains of student loan debt is often welcome: from cities offering debt forgiveness to keep young adults in their areas to programs in which states will pay for portions of their education. Now, more employers are jumping on the assistance train by providing student loan payment contributions as part of their compensation plans. [More]
Show me someone who supports robocalls, and I’ll show you someone that has very few friends. Which is why it’s baffling that the Senate has yet to act on a bill introduced last fall that would close a loophole allowing the government to make debt-collection robocalls. But you know who does support robocalls? The student loan companies that are currently trying to convince Congress that these invasive annoyances are really for our benefit. [More]
In recent years, countless private student loan borrowers have found themselves placed in automatic default – even if they were up-to-date on payments – when their co-signer died or filed for bankruptcy. Federal regulators now appear poised to rein in this often devastating practice, warning student loan lenders and servicers that they could soon face enforcement action if they continue the practice. [More]
More than a century ago, the U.S. did away with the idea of debtor’s prison, and the Fair Debt Collection Practices Act explicitly forbids debt collectors from using the threat of jail time as a way to collect on owed money. So how does a Texas man end up with U.S. Marshals at his door, ready to arrest him for a nearly 30-year-old student loan debt? [More]
Under federal law, student loan borrowers may be eligible to have their debts discharged if they prove the school they attended deceived them with false promises related to their future careers. However, the measure has been used only sparingly in the past and few clear rules outline the forgiveness process. Now, after nearly two decades on the books, federal officials are finally getting around to crafting rules that could remove one roadblock for students seeking relief. [More]
For many recent graduates, repaying their education debt obligations can be a struggle. For some in New York, that struggle just got a little less cumbersome thanks to a recently launched student loan forgiveness program that aims to help the debtors land on their feet after graduation.
Fifty years ago, Congress created the federal loan program as a way to help Americans realize their dreams of a better life through higher education. While millions of students have no doubt benefited from the program, millions of others have found themselves burdened by mountains of debts, fielding calls from debt collectors and loan servicers, and watching as their paychecks are whittled down by garnishments. Today, seven million former college students are in default with a record $115 billion in federal loans. While those figures may be oppressing borrowers, it’s providing a stream of income – and profit – for companies contracted by the government to collect payments from debtors. [More]