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October 27, 2015

Final REPAYE Regs No Big Surprise

At last the final regulations are published! There are a few changes from the draft rules, but nothing major. The best thing? Borrowers can access payments set at 10 percent of "discretionary income" regardless of when we borrowed.  Less great:  If you borrowed for graduate or professional education, forgiveness is after 25 years rather than 20 years (or 120 payments for Public Service Loan Forgiveness) and spouses will not be able to separate their income, even if they file a separate tax return. Key provisions of the new REPAYE plan…

By Heather  |  Category:  REPAYE, Student Loan Repayment  

August 28, 2015

May clergy qualify for Public Service Loan Forgiveness?

Yes, as long as they spend at least 30 hours a week engaged in activities “unrelated to religious instruction, worship services, or any form of proselytizing.”   How do we know? The statute and regulations governing Public Service Loan Forgiveness are clear: The statue establishing Public Service Loan Forgiveness specifies that employment for a 501(c)(3) organization qualifies.  Churches have status as 501(c)(3) organizations. The regulations governing administration of Public Service Loan Forgiveness assert that a 501(c)(3)…

By Heather  |  Category:  Public Service Loan Forgiveness  

August 25, 2015

Student loan servicers screwing 30 percent more troops and counting

When will the loan servicers stop the nonsense? Why isn't the Department of Education holding their feet to the fire? Consider this.  The Department of Justice (Justice, not Education), documented that Sallie Mae has been overcharging interest to active duty members of the military since 2005, in violation of the servicemembers Civil Relief Act (SCRA). According to the Federal Deposit Insurance Corporation (FDIC), Sallie Mae also illegally maximized borrower’s late fees and misrepresented how borrowers…

By Heather  |  Category:  Student Loan Policy  

June 18, 2015

Three Cheers for Rohit Chopra, CFPB Student Loan Ombudsman!

Hip hip!  Hooray!  Rohit Chopra stood up for student loan borrowers during his four-year tenure as the first ever Consumer Financial Protection Bureau's Student Loan Ombudsman.  I thank you, Mr. Chopra.  The Chronicle of Higher Education reports that Mr. Chopra will step down from his post next week.  In his resignation letter, Mr. Chopra wrote, "I am proud of the progress that we have made together to assist borrowers, promote transparency, and hold accountable those who break the law.  While more…

By Heather  |  Category:  Student Loan Policy, Private student loans  

May 12, 2015

REPAYE “targets benefits”

The negotiated rulemaking committe reached agreement on a new repayment option, called REPAYE, expected to become available at the end of 2015.  I'll be writing lots more about this, but for now I'll start by just listing the provisions I consider pluses and minuses for student loan borrowers. Just can't wait to learn more?  Read the proposal here but bear in mind that the next step is for the Department of Education to publish the language that was agreed upon (it's not quite the same), likely…

By Heather  |  Category:  REPAYE, Student Loan Policy, Student Loan Repayment  
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