Betsy DeVos Opens A Can On Student Debt Collecting – Erasing Obama Era Guidelines…

Betsy DeVos Opens A Can On Student Debt Collecting – Erasing Obama Era Guidelines…

Obama’s student loans policies, pushed through in the last months of his presidency, have now been wiped by the new Education Secretary Betsy DeVos. How this will impact students who carry some of the 1.1 trillion dollars in outstanding government debt, remains to be seen.

In August of 2016, Obama’s administration proposed that the companies handling this debt load should shift focus from collecting the debt to helping the students manage their debt payments. This meant that real live customer service agents would take the place of the robocalls that start whenever you get behind on your debt.

I wish that’s how the real world works. No credit card company in the world would instruct their collectors to start coddling as a reaction to being ignored.

The Obama administration felt that this would improve their debt collection practices by no longer focusing on collecting the debt. Sure. In his eight years in office, approximately 8.7 million Americans defaulted on their student loans, despite over $800 million being spent every year to collect that debt.

Since the memorandums left by the previous administration was unclear, DeVos has now withdrawn them, presumably with the intent for students’ loans debt collection to get back into the business of collecting outstanding student loan debt.

She explained:

“We have a duty to do right by both borrowers and taxpayers,” DeVos wrote.

“The student loan servicing procurement affords us a significant opportunity to improve outcomes and experiences for federal student loan borrowers, as well as demonstrate sound fiscal stewardship of public dollars,” she explained.

“We must create a student loan servicing environment that provides the highest quality customer service and increases accountability and transparency for all borrowers, while also limiting the cost to taxpayers.”

Whether it serves the overall purpose of getting that money back to go back to the robocalls instead of coaching students on how to get their budget together, at least we can agree that student loans should probably consider making sure that prospective students should be given debt coaching BEFORE taking on a useless 4 year degree.

Margaret M.

Internet Specialist at Warfare Media.

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