Credit scores decline for millions as student loan collections restart
According to the Federal Reserve Bank of New York, about 1 in 4 people with student loan accounts were more than 90 days behind on payments at the end of March.
Student loans
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IBJ Podcast: Pete the Planner on student loan collections, recessions, stagflation (and holding our breath)
As the U.S. economy contracts, consumer confidence weakens and we await the impact of tariffs, millions of student loan holders must redirect their income to payments. Pete Dunn helps us get a footing in this economic limbo.
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IBJ Podcast: Pete The Planner on potential student loan tumult and its wider economic threats
Federal student loan borrowers haven’t been required to make loan payments since March 2020. But the grace period is almost over: Some 44 million borrowers will be required to either begin or continue making payments in September.
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Supreme Court keeps student-loan cancellation plan blocked for now
The Supreme Court on Thursday agreed to take up the case in late winter. The court’s decision to hear arguments relatively quickly means it is likely to determine whether the widespread loan cancellations are legal by late June.
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Former ITT Tech students get $3.9B in debt cancellation
Students who used federal loans to attend Carmel-based ITT Technical Institute as far back as 2005 will automatically get that debt canceled after authorities found “widespread and pervasive misrepresentations” at the defunct for-profit college chain.
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Articles
Millions of Americans hit with bad credit after missed student loan payments
Millions of Americans are suddenly facing dramatically lower credit scores from delinquent student loans, making it tougher for them to secure housing, insurance, car loans and even employment at a vulnerable time for the U.S. economy.
Student loans in default to be referred to debt collection, Education Department says
The announcement marks an end to a period of leniency that began during the COVID-19 pandemic. No federal student loans have been referred for collection since March 2020, including those in default.
Student loan servicer Navient reaches $120 million settlement
The settlement stems from a 2017 lawsuit brought by the bureau that casts Navient as a company that was far more concerned with its financial interests than the needs of vulnerable student loan borrowers.
Supreme Court rebuffs Biden administration plea to restore multibillion-dollar student debt plan
Cost estimates of the new Saving on a Valuable Education plan vary from $276 billion to $475 billion over 10 years.
Federal appeals court blocks remainder of Biden’s student loan relief plan
The ruling comes the same day that the Biden administration announced another round of student loan relief, this time totaling $1.2 billion in forgiveness for roughly 35,000 borrowers who are eligible for the Public Service Loan Forgiveness program.
Judges in Missouri, Kansas temporarily halt part of Biden’s student debt forgiveness plan
The judges’ rulings prevent the U.S. Department of Education from helping many of the intended borrowers ease their loan repayment burdens going forward under a rule set to go into effect July 1.
Former students of for-profit Art Institutes approved for $6B in loan cancellation
Indianapolis was home to one of the system’s schools, the Art Institute of Indianapolis, from 2006 to 2018.
Biden’s latest student-loan plan cancels $1.2B in federal loans for 153,000
The administration began sending email notifications on Wednesday to some of the borrowers who will benefit from what the White House has called the SAVE, or Saving on a Valuable Education, program.
Some Americans will get student loans canceled in February as Biden accelerates new plan
Borrowers will be eligible for cancellation if they are enrolled in the new SAVE plan, if they originally borrowed $12,000 or less to attend college, and if they have made at least 10 years of payments.
Biden administration moving toward narrower student loan relief plan
The Education Department on Monday released a draft of new federal rules paving the way for a second federal attempt at loan relief.
Biden’s second try at student loan cancellation moves forward with debate over plan’s details
The latest attempt will rest on a sweeping law known as the Higher Education Act, which gives the education secretary authority to waive student loans, although how far that power extends is the subject of legal debate.
Federal student loan payments begin again this month after 3-year hiatus
Millions of Americans must start repaying their federal student loans again in October, with monthly payments averaging hundreds of dollars. Here’s what you should know.
Appeals court halts new Biden rules on debt relief for defrauded students
the U.S. Court of Appeals for the 5th Circuit issued an injunction to prevent the government from implementing regulations that took effect last month while it considers a lawsuit brought by Career Colleges and Schools of Texas.
Latest plan to cut student loan payments could be in for legal battle
The Biden administration calls it a “student loan safety net.” Opponents call it a backdoor attempt to make college free. And it could be the next battleground in the legal fight over student loan relief.
Hoosier borrowers gearing up for restart of student loan payments
Hundreds of thousands of Hoosiers will soon be required to make payments on their federal student loans after a 3-1/2-year pandemic pause—and some of those borrowers are more prepared for that day than others.
Biden plan to cut student loan payments could be in for legal battle
Starting this summer, millions of Americans with student loans will be able to enroll in a new repayment plan that offers some of the most lenient terms ever.
Student loan resumptions might be felt by retailers, restaurants
Just as the American economy is struggling with high inflation and interest rates, the coming resumption of student loan payments poses yet another potential challenge.
Biden vetoes GOP-led effort to strike down student loan forgiveness program
The student loan forgiveness program faces legal challenges, and the Supreme Court is set to issue a ruling on its legality before the end of June.
Senate rejects Biden’s student loan forgiveness program
While President Biden has promised to veto the bill, the vote in the Senate, in which two Democrats and an independent sided with Republicans, shows the divisiveness of the student loan policy and the difficulty of getting any future plan through Congress.