About 5 million Americans are behind on their student loan debt. This number has tripled since the previous decade and continues to grow, with no signs of slowing down any time soon. Recently, Education Secretary Betsy Devos ended her department’s partnership with the Consumer Financial Protection Bureau (CFPB). The CFPB had an agreement with the Department of Education (DOE) to share information regarding the oversight of private actors involved in federal aid programs. This included student loan servicers and private entities that manage collections and payments.
In recent years, the CFPB has become one of the most aggressive regulators of for-profit colleges and student loan servicing companies. Under the Trump administration, federal regulators have taken steps to loosen enforcement over their industries. However, the CFPB has increased its regulatory enforcement by creating a new rule that would allow class action lawsuits to be brought against banks.
With the relationship between CFPB and DOE coming to an end, borrowers are beginning to worry that federal protections might not be enough to help them with aggressive collection agencies. Many loan servicers have bad reputations for their mistreatment of borrowers. From payment issues to harassing their customers, loan servicers have their own interests in mind, not the borrower’s. In fact, the loan service company Navient has been at the center of at least 9 state investigations for their mistreatment of borrowers.
Unfortunately, these investigations have become predictable. Typically a company will deny wrongdoing and end up paying a no-fault settlement to the state and people affected by their actions. While the state attorney general might take this as a win, loan servicers are essentially able to continue their questionable behavior.
We Can Defend Your Rights
Are you stressing out about your student loan debt? Do you have aggressive loan servicers calling you all day? At Wadhwani & Shanfeld, our team of attorneys has experience protecting borrowers from harassment and abusive debt collection tactics. Owing money does not mean you have to surrender your right to respectful, non-threatening treatment.
Contact our Southern California debt defense lawyers, or call (800) 996-9932 for a free consultation.