Well, I wrote something good about a student loan
servicer last week, but, Student Loan News this week
reverts to form.
Student Loan News: Wells Fargo fesses up
As part of a deal announced Monday, the San Francisco banking giant did not admit or deny wrongdoing but agreed to pay a $3.6-million penalty to the Consumer Financial Protection Bureau, plus $410,000 in refunds to borrowers who paid fees that the bureau said should never have been charged.
My favorite, denies any wrongdoing. They just had an extra few million laying around that they did not know what to do with, so, they decided to pay it to the government in fines. Right.
Further minimizing their conduct:
Wells Fargo spokesman Jason Vasquez said all of the CFPB’s allegations relate to practices that Wells Fargo changed several years ago and that affected only a small number of borrowers.
Mmm-hmm. Right again. We only screwed a few people, and we already stopped doing it years ago. Like, even before we were caught. Sounds like a middle school delinquent explaining smoking in the boys’ room.
Student Loan News: Student Loan Servicers and Repayment Plans
The government is so damn big it wars with itself.
The Department of Education has one plan, and the Consumer Protection Finance Bureau (CFPB) has another.
The CFPB has effectively become borrowers’ main advocate in their battle against the Department of Education unit responsible for student loans and the department’s contractors. It created a form (PDF) for borrowers to use when communicating with loan servicers. It is actively soliciting complaints from borrowers. The bureau even created a Twitter hashtag (#ApplicationAbyss) to drum up publicity about its concerns.
One of my recurring themes:
Too few borrowers in distress know they can reduce their payments simply by sharing a few recent pay stubs or a copy of their most recent tax return. Something in the repayment system is clearly broken, and so last month federal education officials moved to scrap it—slowly. In a few years, the Education Department hopes, loan companies to which it outsources collections will prioritize showing debtors how little they can pay to remain current over collections.
I could almost, nah, feel sorry for the poor student loan servicers caught between these two Federal government agencies
Except, if they did their jobs correctly, neither one would be after them.
The whole student loan mess needs overhauling. There has to be an easier way to discharge student loan debt in bankruptcy, and there has to be a halt to the floodgate of student loans out of the Federal government that created the college tuition bubble, and student loan mess, in which we find ourselves.