Student loan servicers are again in the hot seat with the Consumer Financial Protection Bureau (CFPB), this time facing complaints that they mismanaged administration of the Public Service Loan Forgiveness (PSLF) program.
A CFPB report
, released Thursday, highlights borrower complaints about how their student loan servicers delayed, denied, or mishandled access to PSLF through actions like providing incorrect information about their loans, payments processing errors, and problems with job certifications. The errors have led some borrowers to “forfeit months or years of qualifying service” that “can add hundreds of thousands of dollars to the total cost of a borrowers’ student debt,” CFPB said in a press release
According to CFPB, between March 1, 2016, and February 28, 2017, borrowers submitted complaints against their servicers about:
- Receiving incorrect or inadequate information about eligibility for loan forgiveness benefits;
- Delays and errors for processing recertification applications, which results in missed qualifying payments; and
- Issues with the job certification process and form.
“Borrowers working in public service should not miss out on key consumer benefits because their student loan servicer failed to comply with the law,” CFPB Director Richard Cordray said in remarks
delivered at a public event
for the release of the report in Raleigh, NC. “We want every eligible consumer to be able to take advantage of the benefits of the Public Service Loan Forgiveness program without having to worry about servicing breakdowns that can cause them to lose out on months of qualifying payments.”
To that end, CFPB on Thursday issued updated the guidelines
it uses to examine student loan servicers who administer loan forgiveness benefits. CFPB also launched its “Certify Your Service
” campaign to better educate consumers who work in public services about how to protect their progress towards loan forgiveness.
During the public event in Raleigh, CFPB invited several student loan borrowers to speak about the challenges they have encountered with their loan servicers as they pursue loan forgiveness. Watch their remarks below and share your thoughts and experiences in the comments section!