Student loans, student loan cancellation and Navient took center stage in Congress today.
Here’s what you need to know.
Warren (D-MA) chaired an explosive congressional hearing on student loans and student loan cancellation. During the hearing, Warren spent a considerable amount of time berating Navient, one of the nation’s largest student loan managers, and its managing director, Jack Remondi. Warren did not hold back his criticism of Navient and its business practices that Warren said hurt and misled student loan borrowers.
âThe federal government should fire Navient, and Navient should fire you,â Warren told Remondi.
After the hearing, Warren tweeted about Navient: âThe federal government should absolutely fire Navient for illegally overtaxing the government and trapping students in a rigged game. And because it happened under his leadership, Navient should fire Mr. Remondi.
Warren said Navient was named last in a student loan borrower satisfaction survey. Warren also pointed out a series of allegations against Navient, including:
- âA decade of allegations of abusive and deceptive practices targeting student loan borrowersâ;
- paying millions in fines for bad marketing of student loans;
- overburden the federal government by $ 22 million in costs;
- violation of state laws on consumer protection; and
- “Evidence of wrongdoing” in “many other notices and lawsuits”
Remondi disputed the allegations, said his company is committed to helping student loan borrowers and that Navient follows the law. âThese allegations are not true,â Remondi said. “These are accusations and not necessarily based on facts.”
Student Loan Cancellation Failed Because This Student Loan Manager “Can’t Count”
Warren continued to criticize not only Navient but also the CEO of the Pennsylvania Higher Education Assistance Agency (PHEAA), who is also a major student loan manager for federal student loans. The PHEAA, also known as FedLoan Servicing, manages the civil service loan forgiveness program on behalf of the federal government. Warren says that the PHEAA “cannot count”, and therefore, 98% of civil servants rejected for student loan forgiveness.
After the hearing, Warren tweeted: â98% of nurses, teachers and other public servants who have asked for forgiveness on public service loans have been turned down – largely because the PHEAA cannot count. I told the CEO of PHEAA that [the U.S. Department of Education] should fire them and we should #CancelStudentDebt to fix this utter failure.
Most student loan borrowers who are rejected for a utility loan forgiveness do not meet the requirements or have submitted incomplete or inaccurate documents. There have been several proposals to correct the civil service loan forgiveness program, ranging from simplified requirements and increased transparency to an easier approval process. A new proposal calls for the cancellation of the student loan so that civil servants obtain the exemption of the student loan after 10 years of service, even if they have not met any requirements or met any qualification.
Student loan cancellation: next steps
What’s the latest news on student loan cancellation? Warren continues an aggressive campaign to write off student loan debt on behalf of student loan borrowers. Along with Senate Majority Leader Chuck Schumer (D-NY), Warren wants President Joe Biden to enact the cancellation of student loans of up to $ 50,000 in student loans for borrowers by executive order. Warren also wants to simplify the repayment of student loans, while ensuring that officials get their student loans canceled. Biden listens to Warren and his progressive colleagues. Although he has said he does not support $ 50,000 student loan cancellation, he is keeping his options open pending a legal review on the student loan cancellation from the US Department of Education. This review will examine whether the president can unilaterally order the cancellation of the student loan without further authorization from Congress. In the meantime, Biden has already canceled $ 2.3 billion in student loans in a targeted fashion and may continue to cancel more student loans. For example, Biden canceled $ 1 billion in student loans for 72,000 student loan borrowers. It also canceled an additional $ 1.3 billion in student loans for 41,000 totally and permanently disabled borrowers. If Biden decides not to pursue large-scale executive order-in-council cancellation of student loans, Congress will likely need to pass legislation – such as the student loan forgiveness bill proposed by Warren and Schumer – to have the forgiveness of student loans forgiven. student loans become law.
Canceling a student loan is one way to pay off a student loan. It is possible that more student loans will be canceled. However, there is no guarantee that your student loans will be canceled or that you will be eligible for a student loan forgiveness. When evaluating student loan repayment strategies, here are some potential options to consider: