February 18, 2020

The Student Loan Appeal Process the Government Doesn’t Tell You About

"In the deluge of complaints about a troubled program that pays off student loans for people who work in public service, one stands out for its frequency: Thousands of people say they were misled by loan servicers working on the U.S. government’s behalf."

"It is among the most vexing problems with a program that has become a notorious quagmire, with a rejection rate of nearly 99 percent. Lawmakers, consumer advocates and desperate public servants say the Education Department should create a formal process to appeal denials, especially rejections that borrowers say were affected by mistakes made by servicers." 

In reality the Education Department has a system for investigating complaints and fixing the problem — "it just keeps it very quiet" according to Stacy Cowley writing for The New York Times, 2/17/20.

Borrowers who feel they are a victim of a loan servicer’s mistake need to file a complaint with the Federal Student Aid office’s feedback system on the StudentAid.gov website. These complaints go to the agency’s Ombudsman Group, which should investigate the problem.

The NYT article provides plenty of additional information and stories of eligible borrowers who spent years trying to get their loan forgiven.
"Any mistake along the way can set off a cascade of problems — and so far, nearly all of the 109,000 people who have applied to have their loans forgiven have been rejected, according to the department’s latest data. (As of Sept. 30, only 1,139 had succeeded.)"

"The dispute process is not directly described on the websites of the department’s loan servicers — including FedLoan, the sole servicer for the public service program — or on the department’s Public Service Loan Forgiveness information site."

You need to file a complaint to the Education Department’s ombudsman.
Be persistent and engage the help of your members of Congress. Good luck!

https://www.nytimes.com/2020/02/17/business/federal-student-loan-appeals.html?te=1&nl=your-money&emc=edit_my_20200218&campaign_id=12&instance_id=16079&segment_id=21385&user_id=bde4c6c63beab087f13b761e1ee9fe1e&regi_id=8372066420200218

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