Monday, May 25, 2020

The Student Loan Market Is A Growing Component Of The U.s....

The student loan market is a growing component of the U.S. economy. Student loans are the second largest source of household debt. Assisting borrowers with the loan repayment process, like finding the right repayment plan and avoiding default, is an essential component of preventing further drag on the economy. Further, illuminating practices unfriendly to consumers and improving student loan servicing can potentially decrease the default rate and expedite the repayment process. To end these practices, we recommend that the CFPB use its authority to promulgate regulations and implement new student loan servicing protections for borrowers in the following ways: 1. Require student loan servicers to do their part to counsel borrowers about their repayment options using consistent, industry-wide policies 2. Require servicers to send emails to borrowers recapping each interaction or transaction 3. Require student loan servicers to follow borrowers’ payment instructions 4. Issue guidance for student loan servicers to follow when performing account transfers Many borrowers try their best to repay their student loans but encounter unfair policies designed to extend their repayment periods. In April, we conducted an online survey to explore the â€Å"borrower experience† during repayment. We learned that borrowers are doing all or the right things: they borrowed money to get an education necessary to open doors to opportunities. When they entered repayment, however, the frustration,Show MoreRelatedThe Duration Of Unemployment As Provided By The Bureau Of Labor Statistics1704 Words   |  7 Pagessignificantly to 33.7 (BLS 2015). The average hours in 2006 before the Great Recession were also around 34.5 hours, so I would say the labor market has done a good job recovering from the recession (BLS 2015). Even two years ago it seems that we had not fully recovered, when the average weekly hours worked hovered around 34.4 (BLS 2015). 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