Service members continue to experience problems with the servicing of their student loan debt, according to a report from the Consumer Financial Protection Bureau.<\/p>\n\n\n\n
According to the report, there have been 1,300 complaints related to the issue in the last three years.<\/p>\n\n\n\n
It’s not enough for servicers to say they support their military borrowers, said Holly Petraeus, assistant director for Servicemember Affairs for the CFPB, during a press call about the report. “While the sentiment is nice,” she said, companies need to provide more than lip service as they handle loan repayments from service members for federal and private loans.<\/p>\n\n\n\n
She said CFPB continues to hear from service members and their families about the difficulties they face when trying to use their benefits under the Servicemembers‘<\/span> Civil Relief Act, such as the interest-rate cap of 6 percent on student loans they obtained before active-duty service. There are also difficulties in getting the military deferment, which allows some active-duty members to postpone monthly student loan payments under certain circumstances.<\/p>\n\n\n\n While the report generally outlined the problems, it doesn’t provide specifics on the prevalence of the types of complaints. CFPB officials could not provide details, for example, on how many complaints were related to troops’ rights under the SCRA, or how many complaints were related to military deferments of student loans, although those two were cited in the report as among the “commonly reported servicing problems for service members.”<\/p>\n\n\n\n “We do not have a breakdown of complaints but can confirm we heard from consumers about both of those issues,” stated <\/span>an email from the CFPB press office stated in response to questions.<\/p>\n\n\n\n During the press call, Petraeus said officials did not differentiate between complaints about the servicing of federal student loans and private loans. Many borrowers have a mix, she said.<\/p>\n\n\n\n In May 2014, the Justice Department and Federal Deposit Insurance Corp. entered an order for more than 77,000 service members in an action against student loan servicers Sallie Mae and Navient, related to their application of the benefits under the SCRA. Their investigation resulted from complaints received by the CFPB.<\/p>\n\n\n\n Despite this action, and servicers’ public statements about improving their service for military borrowers, Petraeus said, problems persist. Often service members and their families receive unclear and incorrect information about features of particular loan programs and their rights, and how to apply for those benefits. Private loans have few of the legal protections that federal loans have. But private lenders do advertise that they offer certain benefits, she said, and some troops and families have submitted complaints about their inability to access those benefits.<\/p>\n\n\n\n Petraeus said these service member complaints may be the “canary in the coal mine,” signaling larger issues. While she declined to specify what is being done with the complaints, she said CFPB officials meet with officials from the Justice Department and other agencies on a regular basis.<\/p>\n\n\n\n Bureau officials want to make sure service members and services are aware of the protections the troops are entitled to, she said.<\/p>\n\n\n\n Among the findings of the report, “Overseas & Underserved: Student Loan Servicing and the Cost to Our Men and Women in Uniform”:<\/p>\n\n\n\n In May, the CFPB launched a public inquiry into the student loan practices affecting borrowers. The comment period is open until July 13.<\/p>\n","protected":false},"excerpt":{"rendered":" There have been 1,300 complaints related to the servicing of student loans in the last three years, a report says.<\/p>\n","protected":false},"author":7,"featured_media":94413,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_yoast_wpseo_meta-robots-noindex":"","_yoast_wpseo_meta-robots-nofollow":"","_yoast_wpseo_canonical":"","_acf":"","_yoast_wpseo_primary_category":0,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","_smg_distribution_targets":[]},"categories":[7],"tags":[],"coauthors":[3300],"class_list":["post-56527","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-education-transition"],"acf":{"subheadline":"","legacy_arc_id":"DCXFIAKZZJGVPOO2M6OMLXRGIA","arc_canonical_url":"\/education-transition\/education\/2015\/07\/07\/troops-student-loan-problems-persist\/","remove_feature_photo":false,"is_sponsored":false,"subtype":"","redirect_url":"","disable_inline_ads":false,"native_logo_pretext":"Presented By:"},"yoast_head":"\n