Tag Archives: Student Loans

CFPB Takes Action Against Two Alleged Student Debt Relief Scams

by Ashlee Kieler, Consumerist

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The CFPB alleges that College Education Services promised consumers quick relief from default and garnishments. However, the principal debt relief approach the company used – loan consolidation − did not and could not ensure those benefits in all cases, and not in the quick timeframe the company promised. … In a separate but related filing today, the CFPB filed a lawsuit against Student Loan Processing.US to stop the company’s illegal conduct and provide restitution to consumers harmed by the fraudulent actions. Read More ›

Private Student Loan Companies Provide Few Options for Borrower, Driving Them to Default

by Ashlee Kieler, Consumerist

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Officials with the CFPB say these shortcomings reflect an industry that has done little to make good on commitments by lenders to expand alternative repayment options. “The response by the private student loan industry to distressed borrowers is failing to help them avoid default,” Rohit Chopra, CFPB student loan ombudsman says in the report. “Too many borrowers are barely treading water, losing hope that these companies will throw them a lifeline.” Read More ›

Report: Student Loan Debt Isn’t Just An Issue For Young Americans

by Ashlee Kieler, Consumerist

A new report from the Government Accountability Office found that 3 percent of households headed by those ages 65 years or older carry student loan debt, totaling $18.2 billion in 2013. Nearly a quarter of older Americans’ loans are in default – which often leaves the retirees living below the poverty threshold. One California resident told a recent Senate Aging Committee hearing she might be well into her 80s before she pays off her student loans, and she now worries that her Social Security benefits will decline to make payments on the debt. Read More ›

GI Bill loophole keeps 4 major for-profit educators from violating law

by Aaron Glantz, Center for Investigative Reporting

Senate investigators found eight of the top 10 recipients of GI Bill funds were for-profit colleges. In addition, the report said, “the amount of taxpayer dollars paying for veterans to attend for-profit colleges meanwhile has skyrocketed from $640 million in the 2009-10 school year to $1.7 billion last year.” The University of Phoenix’s San Diego campus has received more GI Bill money than any brick-and-mortar campus in America. The school’s overall graduation rate is less than 15 percent, according to the U.S. Department of Education. Read More ›

Corinthian Colleges to sell off 85 campuses; close 12 others

by Chris Morran, Consumerist

For-profit education company Corinthian Colleges – operators of Everest University, WyoTech, and Heald College – which had been receiving around $1.4 billion a year in funding via federal student loans, is currently being sued or under investigation by numerous state and federal authorities for its recruitment and marketing practices. The U.S. Dept. of Education put a hold on its access to loan funds, effectively ringing the death knell for the company. Read More ›

Nasty surprise for some student loan borrowers

by Herb Weisbaum, CNBC

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Students who take out private loans to pay for college could face a nasty surprise if their co-signer dies or files for bankruptcy: The lender may suddenly demand the loan be paid in full—or even worse, put that loan in default—even though all payments are being made on time. The Consumer Financial Protection Bureau issued a consumer advisory on Tuesday, warning borrowers that these “auto-default” clauses may be in their loan agreements and serious financial consequences could result. Read More ›

Corinthian Colleges Sued by Massachusetts Over Job Claims

by Christie Smythe, Bloomberg

For-profit Corinthian Colleges Inc. was sued by Massachusetts over claims it misrepresented job placement rates and pushed students into high-interest loans. The school since 2009 “aggressively recruited and misled students by falsely promising high quality, successful training programs” while leaving them with “exorbitant student loan debt,” state Attorney General Martha Coakley said today in a statement. Read More ›

Proposed Federal Laws & Regulation That Could Help Consumers In 2014

by Kate Cox, Consumerist

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Here are four key areas — mostly proposed laws and one policy — to keep an eye on throughout the new year. If you want to see any of these federal bills become law, make sure you let your representatives and senators know. Read More ›

California lawsuit claims for-profit colleges misled students, investors

by Jeremy White, Sacramento Bee

A for-profit college chain intentionally deceived prospective students and investors about the value of its degrees and sought out socially isolated and disadvantaged students, according to a lawsuit California Attorney General Kamala Harris filed. Read More ›

Senate report finds large cost gap between for-profit, public colleges

by Erica Perez , The Bay Citizen

At for-profit schools, bachelor’s degrees cost an average of 20 percent more and associate degrees are four times as much. Read More ›

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