The Next Front? STUDENT LOAN SERVICING AND THE COST TO OUR MEN AND WOMEN IN UNIFORM

Categorized | STOP FORECLOSURE FRAUD

The Next Front? STUDENT LOAN SERVICING AND THE COST TO OUR MEN AND WOMEN IN UNIFORM

The Next Front? STUDENT LOAN SERVICING AND THE COST TO OUR MEN AND WOMEN IN UNIFORM

The Next Front?
STUDENT LOAN SERVICING AND THE COST TO OUR MEN AND WOMEN IN UNIFORM

Hollister Petraeus
Assistant Director, Office of Servicemember Affairs

&

Rohit Chopra
Student Loan Ombudsman

SUMMARY

Like their fellow Americans, many servicemembers have student loan debt. Congress has enacted a number of protections and benefits for servicemembers to help manage their student loan debt. Unfortunately, the complexities of these provisions, together with problems in loan servicing, have created difficulties for many military families when attempting to manage their debt.

According to National Center for Education Statistics, the average cumulative amount of student loan debt for active-duty servicemembers graduating from college in 2008 was $25,566.1 With over two million men and women serving in the military, ensuring access to clear information about how to successfully manage this debt is critical.

In this report, we identify a range of challenging issues for servicemembers with student loans, including:

Many servicemembers are adopting less favorable repayment plans, which may lead to thousands of dollars in excess debt. Postponing loan payments through deferment or forbearance can seem like an ideal option, but could cost servicemembers tens of thousands of dollars over the lifetime of their loans. Providing information about alternative repayment options could help servicemembers avoid a significant amount of unnecessary debt.

Servicemembers may face barriers when requesting and retaining protections afforded
by the Servicemembers Civil Relief Act (SCRA). Many servicemembers may not have access
to the full range of benefits afforded to them due to servicing errors and complex eligibility requirements.

In the aftermath of the financial crisis, the United States Government Accountability Office reported that there were, “at least 15,000 instances of financial institutions failing to properly reduce servicemembers’ mortgage interest rates and over 300 improper foreclosures…identified by federal investigations and financial institutions.”2

The student loan servicing complaints and stories received by the Consumer Financial Protection Bureau (CFPB) raise concerns that problems confronted by military borrowers are not confined to the mortgage market. This report provides guidance to organizations providing support to servicemembers with student loans and to financial institutions that seek to provide adequate customer service to these borrowers. We also highlight issues for policymakers so that they may better understand the challenges faced by servicemembers with student loans.

This report is intended to expand upon the CFPB’s Student Loan Ombudsman’s report by highlighting specific issues servicemembers face with private and federal student loans.

[ipaper docId=110467898 access_key=key-2c1gieogl4lhyts0ck15 height=600 width=600 /]

© 2010-17 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.



Comments

comments

This post was written by:

- who has written 8646 posts on FORECLOSURE FRAUD | by DinSFLA.

CONTROL FRAUD | ‘If you don’t look; you don’t find, Wherever you look; you will find’ -William Black

Contact the author

Leave a Reply

GARY DUBIN LAW OFFICES FORECLOSURE DEFENSE HAWAII and CALIFORNIA
Advertise your business on StopForeclosureFraud.com

Archives