Category Archives: Student Debt

What students owe and why it matters.

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Owner of Ashford U. Is Ordered to Forgive $23.5 Million in Student Debt

The federal Consumer Financial Protection Bureau has ordered Bridgepoint Education Inc., owner of the for-profit Ashford University, to forgive all outstanding private student loans and to refund any payments already made on those loans.

According to a statement from the agency, Bridgepoint deceived its students by charging them higher-than-advertised monthly loan payments and now must refund or forgive more than $23.5 million in money paid or still owed. The bureau has also ordered the company …

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Amazon and Wells Fargo End Student-Loan Partnership

Wells Fargo has stopped offering Amazon customers reduced interest rates on private student loans, The Washington Post reported on Wednesday.

The partnership was discontinued about a month after the companies announced they were working together. Neither company responded to a request for comment, the Post said.

The short-lived program offered Wells Fargo education loans to Amazon Prime Student subscribers with an interest rate discounted by half a percentage point.

Critics said the partnership …

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U.S. Acts Against Wells Fargo Bank for Illegal Student-Loan Practices

The Consumer Financial Protection Bureau has found that Wells Fargo Bank illegally increased the costs of and unfairly punished certain student-loan borrowers, the federal agency said in a news release on Monday.

The bureau found Wells Fargo’s student-loan servicing did not include payment information for customers, charged them illegal fees, and did not update inaccurate credit-report information.

As complaints from borrowers of private student loans have risen, the federal government has incre…

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Education Dept. Plans to Improve Customer Service for Student-Loan Borrowers

The U.S. Department of Education has adopted a new set of policies to improve student-loan servicing, the agency said in a news release on Wednesday.

In a memorandum, the department said it would work with the Treasury Department and the Consumer Financial Protection Bureau to improve student-loan servicing systems to protect borrowers and help them avoid defaulting on loans. The memo highlighted five specific changes.

Among the most notable, the department will create economic incentives to bet…

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Hillary Clinton Pledges 3-Month Moratorium on Student-Loan Payments

Hillary Clinton, the presumptive Democratic presidential nominee, promised on Wednesday to take executive action to offer a three-month moratorium on federal student-loan payments if she is elected president.

Under the proposal, borrowers would be given resources to help them save money on their loans and to sign up for the correct income-based repayment plans during the moratorium, her campaign said.

Mrs. Clinton has also promised to “eliminate tuition for working families,” a plan that inc…

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New Jersey Student-Loan Agency Hits Troubled Borrowers Hard, Article Says

New Jersey’s Higher Education Student Assistance Authority is the largest state-based student-loan program in the country. It’s also one of the most aggressive in demanding repayment from borrowers and their families, regardless of their circumstances, according to an article jointly published by the independent investigative newsroom ProPublica and The New York Times.

The agency’s loans, which currently total $1.9 billion, come with extraordinarily stringent rules, ProPublica’s investigatio…

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Nearly 1 Million Community-College Students Lack Access to Federal Student Loans

Nine percent of community-college students, or nearly one million people, attend institutions that don’t participate in the federal student-loan program, according to a study released on Wednesday by the Institute for College Access and Success.

According to the group’s latest report, some community colleges say they opt out of federal student loans to keep students from borrowing too much money. As a result, the report says, students feel pushed to take out more-expensive private loans or to re…

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Hillary Clinton Proposes Student-Loan Deferments for Entrepreneurs

Hillary Clinton, the presumptive Democratic presidential nominee, on Tuesday proposed allowing entrepreneurs to defer making federal student-loan payments as a way to encourage them to create more jobs, the Associated Press reported.

Mrs. Clinton told an audience at a rally in Colorado that, under her proposal, entrepreneurs and their early employees would be able to defer payments on their loans for up to three years.

Also under the plan, graduates whose businesses provide social benefits could…

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2 For-Profit Universities Will Cut Arbitration Clauses From Enrollment Agreements

Two for-profit universities owned by the Apollo Education Group will stop including mandatory arbitration clauses in students’ enrollment agreements, the company announced on Thursday.

Students at the University of Phoenix and Western International University will not have arbitration clauses in their enrollment agreements as of July 1, according to a news release.

The group has come under fire for its policy that does not allow students who say they’ve been defrauded to take the colleges to cou…

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Student-Loan Interest Rates Will Drop Again in 2016-17

Interest rates on new federal student loans will drop to their lowest level in a decade next year, Money reports.

The rate on undergraduate Stafford loans will drop from 4.29 percent to 3.76 percent for the 2016-17 academic year. The rate for graduate Stafford loans will be 5.31 percent, a drop from 5.84 percent this year. The rate on PLUS loans, which allow parents to take out loans to pay for their children’s college education, also dropped — from 6.84 percent to 6.31 percent.

Student-loan int…