RSSThe Consumer Financial Protection Bureau has handled more than 20,000 complaints over the last year from consumers about student loans.
Those complaints spurred actions that have produced more than $750 million in relief for student loan borrowers and “strengthened the student loan repayment process for millions more,” the bureau said in a report on the complaints.
These changes include automatic student loan interest-rate reductions for eligible servicemembers, more protections around federal student loan repayment relief, and the elimination of surprise “auto defaults” from most new private student loan contracts.
After rapid growth in the student loan market in the last decade, about 44 million Americans now owe money. The CFPB estimates that combined federal and private student loan debt has reached roughly $1.4 trillion, mostly from federal loans. More than 8 million student loan borrowers have gone at least nine months without making a required monthly payment and are in default. More than 1.2 million borrowers defaulted in 2016.
“Today’s report shows that complaints by student loan borrowers led to hundreds of millions of dollars in relief and important market reforms,” said CFPB Director Richard Cordray. “We will continue to work to address ongoing problems raised by borrowers and hold student loan servicers accountable for treating them fairly.”
The CFPB has handled about 50,700 student loan related complaints and sent complaints to about 360 companies, in total, including student loan servicers, debt collectors, private student lenders, and companies marketing student loan “debt relief.” The CFPB began accepting consumer complaints about private student loans in March 2012 and began accepting complaints about the servicing of federal student loans in February 2016.
