Student Loan Payment Reassessment Announced by Department of Education
Millions of federal student loan borrowers’ status will be reassessed after an NPR investigation found that the handling of income-driven repayment (IDR) plans were botched by the U.S. Department of Education and the loan servicing companies which work under the department.
According to the NPR investigation, the IDR plans, which are meant to help borrowers who can’t make substantial monthly payments toward the balance of their loans, were grossly mismanaged. Although the IDR plans were designed to grant loan cancellation after 20-25 years of low monthly payments, NPR found that several loan servicing companies weren’t keeping track of the amount of payments that borrowers made – meaning borrowers weren’t being alerted when they were eligible for loan cancellation.
“It is not on borrowers to be keeping two decades’ worth of records of how their student loan payments were made and whether each payment counted towards cancellation," Abby Shafroth, an attorney at the National Consumer Law Center (NCLC), a nonprofit that has previously called for reform of IDR, told NPR.
In response to the investigation, the U.S. Department of Education told NPR they were “aware of historical issues with prior processes that had undermined accurate tracking of eligible payments” and that “the current situation is unacceptable” and the department is working to address the issues outlined by the investigation.
https://www.teenvogue.com/story/income-driven-repayment-doe-npr
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