Consumers are complaining about not being able to get lower student loan payments tied to their incomes.
Student loan borrowers are reporting delays and rejections by the companies managing their loans, according to a report released Thursday by the Consumer Financial Protection Bureau’s student loan ombudsman. Such delays and rejections can increased interest charges and cause lost eligibility for some federal benefits and protections.
Student loans make up the nation’s second largest consumer debt, with about 43 million Americans now owing about $1.3 trillion for federal and private student loan debt. The majority of this debt is from federal loans.
In a three-month period ending May 31, the bureau took in 2,400 federal student loan complaints, according to the report. A top complaint had to do with income-driven repayment plans.
To help borrowers, the bureau recommends companies that manage student loans use a “Fix It Form” to improve their services.
The form can help borrowers understand whether their income-driven repayment application has been approved, denied, or needs to be corrected, said Seth Frotman, the bureau’s student loan ombudsman.
When borrowers need to make a correction or provide more information, the company managing their student loan can use the Fix It Form to help consumers understand how to "fix it" and stay on track.
