Federal Student Aid Funding Woes Complicate Resuming Student Loan Payments

"The Office of Federal Student Aid faces a 'colossal undertaking' as it prepares to resume student loan payments after an unprecedented three-year pause, and funding constraints could hamper that effort, student loan experts say," Inside Higher Ed reports

... "Justin Draeger, president of the National Association of Student Financial Aid Administrators, said colleges and universities can play a big role in helping borrowers during the restart."

"The association recently released a tool kit highlighting how institutions can prepare for the resumption of student loan payments. That includes understanding the role of servicers and communicating with students."

"Draeger said this effort isn’t just a financial aid responsibility but one that should involve communications, outreach, alumni, career services and other departments."

"'The reason for that is after a lot of starts and stops, not to mention confusion about debt forgiveness, servicers that borrowers have never heard of or recognize—it’s going to be very perplexing in terms of onboarding for borrowers,' he said. 'The one source of trusted information for borrowers may very well be from the institution.'"

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Publication Date: 5/11/2023

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