A stunning new report has just come out describing ongoing and systemwide failures by federal student loan servicing companies to manage student loan accounts. The report blames both the servicers themselves and the U.S. Department of Education for its failure to hold these servicing companies accountable for their actions. Remarkably, the report was issued and released by the U.S. Department of Education itself.
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The legal landscape of student loan servicing and for-profit schools is a bit like the Wild Wild West right now. There aren’t a whole lot of rules and oversight, and unfair and deceptive practices towards student loan borrowers are fairly widespread. And in our federal legal system, where we have parallel government structures at the federal and the state level, we are seeing a major divergence in prioritizing student loan borrower protections.
One the one hand, the federal government has been actively undermining the few student loan protections that had already existed. Education Secretary Betsy DeVos rescinded Obama-era guidance that was intended to incentivize better treatment of student loan borrowers by servicers, and her administration has been trying to gut student loan forgiveness protections available to people who were defrauded by their schools. At the same time, the Consumer Financial Protection Bureau (CFPB) has, under new leadership, effectively decimated its student loan oversight unit. Suffice it to say, right now the federal government is not doing much of anything to protect student loan borrowers.
But at the same, states are stepping in. State attorney general’s office are playing a big role in advocating for student loan borrowers by bringing lawsuits against servicers such as Navient and FedLoan Servicing. And state legislatures have also been stepping up and trying to pass new legislation that offers protections for borrowers at the state level. A handful of states have already passed state-level “bills of rights” specific to student loan borrowers. And more may be coming.
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After four years on Newbury Street in Boston’s Back Bay neighborhood, I’m thrilled to announce that the Law office of Adam S. Minsky has found a new home in downtown Boston. We’re now located near Post Office Square in the heart of Boston’s Financial District, right next to the historic Langham Hotel. Our new address is:
Law Office of Adam S. Minsky
265 Franklin Street, Suite 1702
Boston, MA 02110
The office is conveniently located near major transit lines. There are three nearby MBTA stations – Aquarium (Blue line), State (Blue and Orange lines), and South Station (Red, Silver, and commuter rail lines), and Government Center and North Station aren’t too far, either. There’s also parking available at the Post Office Square garage and the nearby Langham Hotel and 1 International Place.
I’m excited to start this new chapter!
The longest federal government shutdown in American history continues this week, with no signs of ending anytime soon. Nearly a million federal employees are currently not being paid, and hundreds of thousands of additional workers (such as independent contractors and private vendors) who depend on contractual work with the federal government are feeling the impacts, too.
Many people who are affected by the shutdown have student loans that are due, and they are about to miss additional paychecks. If the shutdown continues for another couple of weeks, the impacts are going to drastically widen in scope.
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Last week, the New York Attorney General’s office reached a $9 million settlement with ACS – one of the country’s major student loan servicers – for systematically harming student loan borrowers by misinforming them, misleading them, misapplying payments, and more.
As far as I can tell, no one who works with student loan borrowers is surprised. The types of problems that the New York Attorney General’s office found are widespread, and by no means limited to ACS. The Consumer Financial Protection Bureau (CFPB) has reported extensively on rampant student loan servicing problems throughout the industry. Major lawsuits brought by other state attorney general’s offices are still ongoing against giants such as Navient and the Pennsylvania Higher Education Assistance Authority (PHEAA), which also runs FedLoan Servicing. Even smaller servicers such as ECSI have been under investigation.
It doesn’t take a rocket scientist (or a student loan expert) to understand what’s going on here: the federal government outsources the servicing and day-to-day operations of its entire student loan portfolio to a handful of private companies. And it pays them handsomely; one servicer, Nelnet, made more than $200 million in profits in 2016 alone. But there is virtually no oversight of these companies, and no accountability. It’s often up to individual states (usually via proactive attorney general offices) to try to protect borrowers, leading to a patchwork of enforcement actions that can sometimes get results (like we just saw in New York) but doesn’t always lead to systemwide change.
I am thrilled to announce that my first client got her student loans forgiven through the Public Service Loan Forgiveness program. It wasn’t necessarily easy, and it wasn’t necessarily quick, and she ultimately needed to request additional relief through a related program called Temporary Expanded Public Service Loan Forgiveness. But, it worked. She now has a $0 balance on her student loans, and she’s even getting refunded for some payments that she made. Incredible! I wrote about her experience in my latest article for Forbes – check it out here. And stay hopeful!
Last week, I got a call on my cell phone. I didn’t recognize the number, but it was from my own area code; I had gotten several of these calls during the prior week or two, but I had not picked up, suspecting it could have been a robo-dialer. But this time, curiosity got the better of me, so I answered.
A pre-recorded message said the following to me: “You are being offered a lower monthly payment and loan forgiveness for your student loans. Due to our numerous attempts to reach you, this offer will be revoked if we don’t hear from you within 48 hours. If we don’t hear from you, you will no longer be eligible for these programs. Please press 2 to be connected to a customer service representative.”
I promptly hung up. This, folks, is a scam, and it’s the latest tactic being employed by predatory student loan “assistance” companies who are trying to prey on student loan borrowers desperate for a solution to their debt. And while I can easily spot these types of schemes as a student loan lawyer, for many other people it’s a lot tougher to discern a scam from a legitimate program.
If you’ve been contacted by a student loan assistance company and you’re not sure whether or not the company is legitimate, here are some things to consider:Read More
Well, it’s the day after Election Day 2018. Analysts and pundits are still trying to figure out what the election results mean nationally. However, today I want to focus specifically on student loan borrowers.
Ballots are still being counted in many precincts, and not all races have been called. But as it stands, it looks like Democrats have retaken the House of Representatives, while Republicans have expanded their Senate majority. Democrats have flipped at least seven state governorships, while Republicans have held on to several others. There was a Democratic wave in many states, but Republicans also generally held their own or exceeded expectations in several key races. So, how does this all add up for student loan borrowers?Read More
For the fourth year in a row, Attorney Adam S. Minsky has been named a Massachusetts Super Lawyer “Rising Star” for his ongoing work helping student loan borrowers. This recognition is only given to the top attorneys in the state, and it reflects Attorney Minsky’s work ethic, expertise, and dedication to helping people who have student loans.
Attorney Minsky has been sharing his expertise with many others this year, and has been invited to speak and conduct workshops across the country. He recently returned from Chicago where he taught hundreds of financial planners about student loan law at the annual Financial Planning Association (FPA) conference, and is scheduled to speak to other financial planners in New York and Wisconsin. And in the past month, Attorney Minsky has given student loan management presentations to employees at the Broad Institute in Cambridge, to AmeriCorps members via the Mass Service Alliance, and to legal services attorneys at the Boston Bar Association.
Attorney Minsky’s name will be published in Boston magazine and Super Lawyers magazine.
When I talk about being a student loan lawyer, most people assume that my clients are all about 22 years old, fresh out college, dealing with crippling student loan debt. That’s actually not true at all. A large number of my clients are older folks who took out a particular type of federal loan called a Parent PLUS loan, for the benefit of their children. And many of them are struggling.Read More
