personal finance

Student Loan Default: Elizabeth Warren Claims Abusive Practices For Student Loans


Sen. Elizabeth Warren is calling out this student loan servicer for abusive practices amid looming student loan default.

Here’s what you need to know.

Student Loans

In a scathing letter to student loan servicer Maximus, Warren (D-MA) wants assurances that Maximus will protect student loan borrowers when Maximus assumes Navient’s portfolio of 5.6 million student loans when Navient is expected to stop servicing federal student loans by year end. Here’s what inside the letter:

Student loan relief is ending soon

Warren is deeply concerned that the Biden administration will not extend student loan relief from the Covid-19 pandemic beyond January 31, 2022. That means student loan borrowers will restart federal student loan repayment beginning February 1, 2022. Student loan payments and student loan interest rates will return to normal following 22 months of temporary student loan forbearance. (Here are 3 ways to get a lower student loan payment). Warren has expressed concern that millions of student loan borrowers will default on their student loans if President Joe Biden doesn’t extend student loan relief until later next year. Despite her efforts to extend student loan forbearance, the U.S. Department of Education has said there will be no extension of this student loan relief. At the same time, Warren has been the leading advocate calling for wide-scale student loan forgiveness for borrowers, including up to $50,000 of student loan cancellation. (Here’s how to apply for limited student loan forgiveness).




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