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Trump administration rolls back protections for people in default on student loans

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G

giga

Member
The Education Department is ordering guarantee agencies that collect on defaulted debt to disregard a memo former President Barack Obama's administration issued on the old bank-based federal lending program, known as the Federal Family Education Loan (FFEL) Program. That memo forbid the agencies from charging fees for up to 16 percent of the principal and accrued interest owed on the loans, if the borrower entered the government's loan rehabilitation program within 60 days of default.

The Obama administration issued the memo after a circuit court of appeals asked for guidance in a case against United Student Aid Funds (USA Funds) challenging the assessment of collection costs. Bryana Bible took the company to court after being charged $4,547 in collection costs on a loan she defaulted on in 2012. Though she had signed a ”rehabilitation agreement" with USA Funds to set a reduced payment schedule to resolve her debt, the company assessed the fees.

Education officials sided with Bible, prompting USA Funds to sue the department in 2015. Earlier this year, the company agreed to pay $23 million to settle a class-action lawsuit born out of the Bible case, though it did not admit any wrongdoing.

The two-page ”Dear colleague" letter from the Trump administration walks back the department's previous stance on the grounds that there should have been public input on the issue.

”The department will not require compliance with the interpretations set forth" in the previous memo ”without providing prior notice and an opportunity for public comment on the issues," the letter said.

The action does not affect any borrowers whose loans are held by the Education Department, according to the department. It could, however, impact nearly 7 million people with $162 billion in FFEL loans held by guarantee agencies.

Nearly half of the total outstanding student debt in default comes from the FFEL program. There has been a fairly steady increase in the total amount of past-due debt in the program, even as the number of borrowers has declined, suggesting that interest charges and other fees are being tacked on to balances.
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https://www.washingtonpost.com/news...udent-loans/?tid=sm_tw&utm_term=.7e52981a9eb5

Letter here: https://ifap.ed.gov/dpcletters/attachments/GEN1702.pdf
 
RPGCrazied

RPGCrazied

Member
Sölf;232365391 said:
So, is there anything he won't roll back?
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He is just doing everything associated to Obama, he wants to erase his legacy. Obama should run for senate. Be a thorn in this fuckers side or something.
 
Z

Zeus Molecules

illegal immigrants are stealing our air
RPGCrazied said:
He is just doing everything associated to Obama, he wants to erase his legacy. Obama should run for senate. Be a thorn in this fuckers side or something.
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It's sad cause all Obama did was get us out of the Great Recession. The total lack of awareness that his predecessor was very good at his job is going to really stain Trumps presidency beyond his own general incompetence. I really hope in 4 years he gets kicked out and I'll still be around to enjoy the look of misery on Trumps face.
 
F

FStubbs

Member
eizarus said:
Fuck sake. What's the point in turning your own country into a shit hole?
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It makes people like him (who defrauded students at Trump University) money.

But one thing you have to realize that this isn't just Trump. This sort of thing is standard Republican policy, and a President Cruz, Rubio, or Pence would be doing this too.
 
F

Future

Member
Apt101 said:
I wonder how the young alt-right debtors without jobs are going to sugar coat or self deny this one.
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Blame their problems on other liberal policies

If not for affirmative action I could have gotten into an affordable school!

If the class wasn't slowed academically by minorities, I would have excelled more and graduated faster with less debt!
 
RPGCrazied

RPGCrazied

Member
Keep tanking Trump. I love seeing this.

C7S99EvU0AAD5tL.jpg:large
 
V

Vengrim

Member
Allowing those high fees just increases the likelihood of the loan never being able to be repaid and thus abandoned sooner resulting in less money for the lender. There is a reason debt negotiation is a thing. Some money is better than no money.
 
E

ezekial45

Banned
Dangansona said:
What caused those last two spikes? Surely not Merkel?
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Healthcare stuff setting in, more likely.

Anyway, I'm still about $30k in student loan debt (fuck Grad School). I was going to look into defaulting, as I'm facing serious underemployment in my area and having to pay off other expenses, but now it's clearly not a good idea.

Shit, I really don't know what to do now. My debt is bad, and the job search in SF is still brutal.
 
M

Madness

Member
eizarus said:
Fuck sake. What's the point in turning your own country into a shit hole?
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So no one wants to come there anymore and only the white and black people who have nowhere else to go are stuck? Think about this, 4 more years still. With a possibility of 8. How many people around the world want to be in the US? We are seeing hundreds of migrants and refugees and illegals come into Canada from Minnesota and other places to circumvent the first safe country agreement. Had they tried to come by border they would be sent to the US where they entered first but under Trump aren't guaranteed anything. They risk frostbite, death, starvation to escape the US into Canada in places like Quebec and Manitoba in the winter.

He is making America great again by making it so shitty no one wants to come or stay.
 
P

plagiarize

Banned
Madness said:
So no one wants to come there anymore and only the white and black people who have nowhere else to go are stuck? Think about this, 4 more years still. With a possibility of 8. How many people around the world want to be in the US? We are seeing hundreds of migrants and refugees and illegals come into Canada from Minnesota and other places to circumvent the first safe country agreement. Had they tried to come by border they would be sent to the US where they entered first but under Trump aren't guaranteed anything. They risk frostbite, death, starvation to escape the US into Canada in places like Quebec and Manitoba in the winter.

He is making America great again by making it so shitty no one wants to come or stay.
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Yup. And it still isn't going to stop the demographic shifts that are slowly killing off like minded people.
 
R

rjinaz

Member
The only good thing about this shit that Trump keeps doing is that it gives that Democrat Candidate in 2020 a lot of material to work with. Can run a lot of their campaign on reversing harmful policies for poorer Americans.
 
R

rjinaz

Member
kiunchbb said:
By the same poll that said Hillary going to win?
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Just because election polling had Hillary winning, and she did have more votes and the most polls were within margin of errors, doesn't mean all polls ever are now fake news despite what Trump would have you believe.
 
J

JoeyJungle

Banned
kiunchbb said:
By the same poll that said Hillary going to win?
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I'm so tired of this any time there's a poll. Hillary had 3 million more votes, and Trump received an elector victory by just 100,000 votes across three states. The polls were broadly accurate given their confidence intervals, and predictors giving Hillary ~80% odds to win were essentially correct given her huge win in the popular vote and how narrow her defeat and Trump's win was.
 
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