Category Archives: Student Debt

What students owe and why it matters.

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Education Dept. Reports Increase in Borrowers Using Income-Based Repayment

There has been a large increase in the number of borrowers enrolling in income-based student-loan repayment plans, according to statistics released by the U.S. Department of Education on Thursday. The spike follows an effort by the Obama administration to better publicize the option.

According to the department, almost four million borrowers had enrolled in income-based repayment as of June 30, a 56-percent increase compared with that time last year. Also, the share of borrowers who are more tha…

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Hillary Clinton Asked for Emoji-fied Takes on Student Debt. You Will Believe What Happened Next.

So there was no way this was going to end well, right?

Hillary Clinton’s social-media team, looking to keep her recently announced college-affordability plan in the public eye, took to Twitter to ask for a bit of audience feedback on student loans. This being Twitter, and the target audience clearly being Millennials, her staff decided, inevitably, to ask for that feed…

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In Clinton’s Higher-Ed Agenda, Expect Echoes of Past Plans on Student Debt

Hillary Clinton, the heavy favorite among Democrats running for president, plans to announce key planks of her higher-education platform on Monday at an event in New Hampshire, Politico reports. When she does so, student-loan reform will be the dominant theme.

That’s not a surprise. The specter of student-loan debt has hovered over the early stages of the Democratic campaign, as The Chronicle’s Kelly Field reported in June. Both of Mrs. Clinton’s challengers for the Democratic nomination, Sen. B…

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Financial-Services Company Is Accused of Misleading Students

The Consumer Financial Protection Bureau has filed a complaint against a financial-services company, Student Financial Aid Services Inc., that it says illegally misled students. The federal bureau announced on Thursday that it had filed a proposed consent order that, if approved by a federal judge, would require the company to pay $5.2 million back to consumers.

The bureau alleges that the company, which provides assistance in filling out the Free Application for Federal Student Aid (or Fafsa) a…

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Student-Loan Servicer Is Ordered to Pay Back $16 Million to Borrowers

The Consumer Financial Protection Bureau has ordered a private student-loan servicer to refund nearly $16 million to borrowers after the federal agency found evidence of illegal practices. According to a consent order filed by the bureau, Discover Bank overstated in billing statements the minimum amount borrowers had to pay, engaged in illegal collecting practices, and did not provide necessary tax information to borrowers.

“Discover created student-debt stress for borrowers by inflating their b…

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Martin O’Malley Has $340,000 in Parent PLUS Loans

The Democratic presidential candidate Martin O’Malley is set to outline his plan for debt-free college on Wednesday, joining the chorus of lawmakers proposing similar measures to lower the cost of a higher education.

Mr. O’Malley is no stranger to debt resulting from a college education. The Huffington Post reports that his family has borrowed nearly $340,000 in Parent PLUS loans for his two daughters’ college educations. (One went to Georgetown University, the other to the College of Charleston…

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Education Dept. Takes Steps to Ease Repayment for Student-Loan Borrowers

With student debt playing a prominent role in the 2016 presidential campaign, the Obama administration is taking several steps to ease borrowers’ repayment burdens.

This week the Education Department is expected to publish a proposed rule that would expand and remake Pay as You Earn, the most generous of the income-based repayment plans for student loans. The rule, which a panel of negotiators agreed on in April, would also make it easier for borrowers in the military to receive an interest-rate…

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Consumer Watchdog Highlights Military Borrowers’ Problems With Loan Servicers

A report released on Tuesday by the Consumer Financial Protection Bureau highlights continuing problems that military borrowers face when interacting with student-loan servicers.

The federal agency’s report comes two months after the Education Department cleared student-loan servicers following a yearlong investigation of their treatment of military borrowers. Holly Petraeus, the bureau’s assistant director for service-member affairs, said in a conference call on Tuesday that the report “docum…

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Student-Debt-Relief Firm Will Shut Its Doors After New York Investigation

[Updated (7/1/2015, 9:09 p.m.) with news of a lawsuit against another company supposedly helping borrowers with debts.]

A business offering student-loan “debt relief” will close its doors as part of an agreement with New York’s governor, Andrew M. Cuomo. The Times Union, a newspaper in Albany, reports that an investigation by Mr. Cuomo’s office found that Interactiv Education LLC advertised it could lower student-loan payments when, in fact, it just filled out a loan-consolidation form that is a…

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Federal Government’s Student-Loan Watchdog Will Step Down

Rohit Chopra, the Consumer Financial Protection Bureau’s first student-loan ombudsman, will step down next week, he wrote in a letter on Wednesday.

“I am proud of the progress that we have made together to assist borrowers, promote transparency, and hold accountable those who break the law,” Mr. Chopra wrote to Jacob J. Lew, the U.S. treasury secretary. “While more work is needed to correct the serious deficiencies in the student-loan market, I have great confidence in the bureau’s ability to co…