The U.S. Department of Education announced it will resume collections on defaulted student loans on May 5, affecting over 5 million borrowers who haven't made payments in the past year. Secretary of Education Linda McMahon emphasized the need to protect taxpayers from poor loan policies. Critics, like Aissa Canchola Banez, highlight the timing as particularly problematic due to ongoing economic uncertainty, especially for older borrowers over 65, many of whom struggle with default. The department will notify borrowers via email and refer those in default to the Treasury's collections program.
American taxpayers will no longer be forced to serve as collateral for irresponsible student loan policies, said U.S. Secretary of Education Linda McMahon. This announcement has significant implications for borrowers.
This could not have come at a worst time for millions of Americans, said Aissa Canchola Banez. Borrowers are already finding themselves navigating incredible economic uncertainty.
Nearly 40 percent of federal borrowers over the age of 65 were in default on their student loans, according to a 2017 report from the Consumer Financial Protection Bureau, highlighting the struggles faced by older borrowers.
When borrowers fall behind, their credit scores can take a hit, making it harder to qualify for more credit and other loans for essential needs, according to Aissa Canchola Banez.
Collection
[
|
...
]