Trump Administration Cancels Controversial Contract Bid for a New Student Loan Servicer
"The Trump administration on Tuesday canceled a contract solicitation that would have handed the management of the federal government’s $1.2 trillion portfolio of education loans to a single company amid growing complaints from industry stakeholders and lawmakers," The Washington Post reports
"Education Secretary Betsy DeVos said the Office of Federal Student Aid will create a single online platform for use by one or more loan servicers, a move that is largely aligned with the terms of the contract solicitation issued by the Obama administration. DeVos amended that solicitation in May to have one company build the portal and collect all federal student loans on the department’s behalf.
Now, DeVos says the department will devise a new approach to servicing that will require separate acquisitions for database housing, system processing and customer account servicing that will provide the opportunity for many companies to submit proposals for contracts. ...
Justin Draeger, president of the National Association of Student Financial Aid Administrators, applauded the department for being willing to engage stakeholders to improve the servicing system.
'The key,' he said, 'will be to have strong consumer-centric requirements in the contracts so borrowers can get the best service possible.'"
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Publication Date: 8/2/2017