Student Loans: I’m From The Government, And I’m Here To Help You

The government looks like one gigantic

student loan relief?
student loan relief?

overgrown entity to most of us.

Well, because it is.  So big that its

various parts do not seem to talk to

each other.

You would think, the, in itself, large Social Security bureaucracy would be able to share information with

the Department of Education on who has been determined to be disabled.

Well, OK, they, only recently, did this.

But the Department of Education is working to make it easier for borrowers who qualify for a disability discharge to receive it. Earlier this year, the agency cross-referenced its records with those of the Social Security administration and identified nearly 400,000 borrowers who qualified for a discharge — about 100,000 of which were at risk of losing their tax refunds or Social Security benefits over the debt — and sent them a letter inviting them to apply for one. The agency also began suspending disability benefit offsets in cases where it’s clear the borrower has a medical condition that won’t improve, according to the recent GAO report.

How Is A Disabled Person Supposed To Figure Out The Rules?

Especially those who are emotionally or mentally impaired.

Aren’t the student loan servicers hired by the Department of Education supposed to advise student loan borrowers of all their repayment options?

Jillian Berman has more in her article on Market Watch.

Loonin said ideally the Department would step in before a borrower who is permanently disabled faces offset by not certifying their debt for collection. When the Department refers a debt to collections, the agency is certifying that it’s legally enforceable. If borrowers qualify for a discharge, that’s not the case, Loonin argues. And once the debt goes into collections, it’s challenging for a borrower to raise the issue of a discharge, she said.

In the suit, Rodriguez claims he told his debt collector that he was disabled and was looking for a way to avoid having his benefits garnished, but the company didn’t inform him of his right to apply for a disability discharge. The suit notes that government-hired debt collectors aren’t incentivized to tell borrowers they could have their debts wiped away because they earn more money when borrowers choose other ways to get out of default.

The executive branch tells the legislative that they are fixing things, especially when pressed by representatives who are being badgered by constituents.

The Department of Education announces a bunch of student loan relief programs or options.

And the student loan debt collectors fail to implement them, because, they make more money by NOT telling student loan borrowers all their options.

Keep the pressure on Congress for real student loan relief.

Summary
Article Name
Student Loans: I'm From The Government
Description
Government student loan relief programs exist, but how well are they working?
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