Many student loan borrowers are facing difficulties in contacting their loan servicers, leading to frustrations and lack of crucial information about their loans.
There are almost 28 million borrowers of student loans, and the situation will only get more complicated when interest rates start to rise and payments start in October.
“Mounting Frustration: Student Loan Borrowers Express Discontent with Servicers as Payment Restart Looms”
Issues such as long wait times and website problems have made it challenging for borrowers to determine their outstanding balances, payment due dates, or how to make early payments without incurring extra charges.
One example is Danika Wahlin, who anxiously awaits information on whether she qualifies for the new SAVE payment plan. However, her loan servicer, EdFinancial Services, has yet to provide her with the necessary payment details due to delays caused by their transition to a new system. This lack of information is causing significant stress for Danika and her wife, as it could potentially impact their already tight budget.
CNN’s attempts to reach out to loan servicers EdFinancial and Nelnet went unanswered. The parent company of Aidvantage, Maximus, redirected CNN to the Department of Education, which stated its commitment to working closely with loan servicers to ensure borrowers receive the necessary information. The department has been sending frequent emails and text messages to inform borrowers about available resources. Additionally, the Biden administration implemented a rule until September 2024 that missed loan payments will not be reported to credit agencies, offering some relief to borrowers.
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“Student Loan Repayment Process Has Become Confusing and Frustrating for many Borrowers”
The student loan repayment process has become a source of confusion and frustration for millions of individuals. Approximately 28 million people have student loans, and with interest resuming and payments scheduled to begin in October, the situation becomes even more complex. Each borrower may have different payment due dates, and the loan servicers, hired by the Department of Education, handle the payments. Many borrowers with federal loans have not made payments for over three years due to payment freezes that kept being extended until Congress intervened.Now, individuals who completed their studies during the freeze are making their initial payments, and some have even changed loan servicers due to expired contracts. Unfortunately, the Federal Student Aid office did not receive sufficient funding to effectively manage this situation.
Marlee Lane, a 32-year-old, had to endure a frustrating four-hour wait on hold with her loan servicer, EdFinancial. She wanted to pay off her loan balance before payments resumed in October to avoid paying extra interest in September. However, when she attempted to make a payment online, the system prevented her from doing so. After four hours on hold, Marlee discovered that her loans were in forbearance, a status she was unaware of. Now she must opt out of forbearance before making a payment.
Similarly, Danielle Dodder, 48, is facing difficulties with EdFinancial’s customer service. Although she can access her account, she is perplexed by the unexpectedly high payment amount without any explanation. The process confuses and worries Danielle. Moreover, the EdFinancial website demands that she recertify her income to remain in her repayment plan, despite the Department of Education’s guidance to recertify after the six-month payment freeze ends. Feeling utterly lost, Danielle is unaware of the current status of her loans.
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