CFPB-PR-241115-1 (11-15-24) (CFPB-PR-2411)
CFPB Report Details Student Borrower Harms from Servicing Failures and Program Disruptions – Analysis of 18,000 borrower complaints reveals payment processing errors, inaccurate bills and repayment information, and unhelpful customer service
Excerpt: WASHINGTON, D.C. – The Consumer Financial Protection Bureau (CFPB) today released the annual report of the CFPB Student Loan Ombudsman, highlighting the severe difficulties reported by student borrowers due to persistent loan servicing failures and program disruptions. The report details how millions of student borrowers have received relief through new income-driven repayment plans, cancellation programs, and various adjustments and program automation processes. However, borrowers tell the CFPB how servicing breakdowns, including inaccurate information provided by servicers, improperly processed payments, and delayed income driven payment applications have stymied their return to repayment.
“Student borrowers continue to face lengthy delays and costly errors because of servicer failures,” said CFPB Director Rohit Chopra. “The CFPB is working to ensure there is greater accountability and improvements in the student loan system.”
“Our analysis of over 18,000 consumer complaints shows that servicer errors with billing, customer service failures, and incorrect repayment information are causing severe financial and personal distress to borrowers,” said CFPB Student Loan Ombudsman Julia Barnard. “As the federal loan system undergoes rapid changes, it is crucial that servicers immediately address these persistent issues. Policymakers should ensure that student borrowers can access the loan cancellation and lower monthly payments they are entitled to and implement new accountability measures to fix these long-standing problems.”
Categories: Student Loans
CFPB-PR-241115-1 (11-15-24)