Boston Student Loan Lawyer

Law Office of Adam S. Minsky

What the Election Results Mean for Student Loan Borrowers

| Articles Current Events Income-Driven Repayment Loan Forgiveness Policy & Reform

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

Major Changes Are Coming to Student Loan Servicing

| Articles Current Events Income-Driven Repayment Policy & Reform

Brace yourselves. Major student loan servicing changes are coming.

First, some quick background. Most federal student loans are either owned directly by the U.S. Department of Education via the “Direct” loan program, or are held by a private lender via the now-defunct “FFEL” program (also known as the “guaranteed” loan program). The vast majority of Direct and FFEL student loans are not handled by the lender, however. Instead, the lenders hire contractors – called student loan “servicers” – to manage the day to day operations of the loan accounts such as payment processing and application evaluation. These servicers generally do not own your student loans, even though you have to deal with them to do anything with your account. They are simply contractors working on behalf of the lender.

The U.S. Department of Education is moving forward with a major overhaul of its student loan servicing system that will transform every aspect of federal student loan repayment – from payment processing, to re-certification for income-driven repayment plans, to requests for deferments and forbearance.Read More

Scary Stats for Public Service Loan Forgiveness

| Articles Current Events Income-Driven Repayment Loan Forgiveness

The U.S. Dept. of Education released a report this week on the Public Service Loan Forgiveness (PSLF) program – and the details are rather stunning.

First, some background. To get student loans forgiven under the PSLF program, borrowers must make 120 “qualifying payments,” which are payments that (1) are made on Direct federal student loans, (2) under a qualifying repayment plan – which is either the 10-year Standard plan or an income-driven repayment plan, while (3) working full-time for a qualifying public service employer.

The program was not enacted until October 1, 2007, and it’s not retroactive to before that date. This means that the soonest anyone could have been eligible for loan forgiveness was October 1, 2017. Since so few people knew about the program during the first few years of its existence, not many people have qualified so far. However, nearly 12 months into the “eligibility era” (as I call it), we haven’t had much specific information about  the number of people applying.

Until today. Read More

Student Loan Legislation Update

| Articles Current Events For-Profit Colleges Income-Driven Repayment Loan Forgiveness Policy & Reform Private Student Loans

There is quite a lot going on right now when it comes to student loans. It seems that every month there’s a new bill or a new rule that could significantly impact student loan borrowers. But keeping track of it all can be a bit overwhelming.

First, a very brief overview of how law-making works. Our legal and political system is multi-layered and may seem complicated, but I’ll break it down for you:

  • Legislation – or a proposal for a new law – must be passed by a law-making body like Congress (at the federal level) or a state legislature (at the state level). Congress, and most state legislatures, have two chambers – the House and the Senate – and legislation must pass both chambers, and be signed by the President (or a Governor) to become law.
  • Regulations (also simply called rules) can be created by executive agencies, such as the U.S. Department of Education. Agencies have broad powers to issue new rules or regulations under existing statutes, which can dramatically impact programs that were already created by previous legislation. When agencies create new rules or regulations, they have to follow a formal process before they can go into effect, but they do not typically require approval by Congress (or an equivalent state legislature).

So, with the above in mind, here’s my overview of the most important developments during the last few weeks.Read More

The Latest Student Loan Servicing News

| Articles Current Events Income-Driven Repayment

There’s always a lot going on when it comes to student loan servicing, and it can be hard to keep track of everything. Here are some of the latest developments impacting student loan borrowers:

Great Lakes Higher Education and NelNet. Last year, Great Lakes and Nelnet – two of the largest student loan servicers in the country – announced that they would be merging (Nelnet purchased Great Lakes for $150 million). The merger should be completed this year, and in the meantime, I am already seeing some Great Lakes accounts being migrated over to Nelnet. If you are a Great Lakes customer, you will likely be switching over to Nelnet before the end of this year, so just be ready for that. Borrowers may have to re-establish their payment arrangements (such as auto-debit).Read More

BREAKING: New Details on Expanded Student Loan Forgiveness

| Articles Current Events Income-Driven Repayment Loan Forgiveness Policy & Reform

A couple of months ago, Congress passed new legislation expanding eligibility requirements for Public Service Loan Forgiveness (PSLF). That legislation gave the U.S. Dept. of Education 60 days to create formal notice and a procedure for evaluating applicants requesting forgiveness under this expanded program. We haven’t known what the procedure would be, and how or when borrowers could gain access to this program – until now. And, unfortunately, I think it’s going to be a mess.

First, a recap of PSLF. To get your student loans forgiven under the program, a borrower must make 120 “qualifying payments.” A “qualifying payment” is one that is made (1) on the right type of federal student loan, which is a Direct loan; (2) under the right type of repayment plan – which is either an income-driven repayment plan or the 10-year Standard plan; while (3) working in qualifying employment. Read More

Here’s a List of Rollbacks to Student Loan Protections

| Articles Current Events For-Profit Colleges Income-Driven Repayment Loan Forgiveness Policy & Reform

The Trump/DeVos administration has been busy during the past 18 months, rolling back significant protections for student loan borrowers and their families. Just in the past couple of weeks, there have been two new developments that curtail regulation of predatory schools, lenders, servicers, and debt collectors.

First, the Consumer Financial Protection Bureau (CFPB), now under the leadership of Trump appointee Mick Mulvaney, effectively eliminated its student loan division by rolling it into a different department that has no investigatory or enforcement power. Previously, the CFPB’s student loan division had issued comprehensive, data-driven reports on the atrocious state of federal student loan servicing. It had also brought numerous enforcement actions and filed several lawsuits against predatory companies, including Navient, returning upwards of $750 million to student loan borrowers and other consumers harmed by unfair or harmful business practices. It looks like we can no longer count on the CFPB to do this work. Read More

MA Senate Passes Student Loan Bill of Rights

| Articles Current Events Policy & Reform

This week, the Massachusetts State Senate unanimously passed the Student Loan Bill of Rights – powerful legislation that would enshrine new state-level protections for student loan borrowers in the Commonwealth. I was proud to testify at the State House last year in support of the bill, and I am thrilled to see it pass the State Senate with bipartisan support.

The bill still has to pass the House and be signed by Governor Baker before it becomes law. But this is a major first step. If it becomes law, the legislation could do a lot to protect student loan borrowers. Here’s how:Read More

BREAKING: Expanded Eligibility for Public Service Loan Forgiveness

| Articles Current Events Income-Driven Repayment Loan Forgiveness Policy & Reform

Last week, Congress passed – and the President signed – a major spending package that touches nearly every element of society. Buried deep within the 2,200 pages of legislation are some interesting provisions regarding the Public Service Loan Forgiveness (PSLF) program, which allows borrowers to get any remaining balance on their federal student loans forgiven after 10 years of “qualifying payments.”

First, a recap of the PSLF program. It’s not so much about “10 years” of qualifying payments as it is 120 individually qualifying monthly payments (which, if made consecutively, add up to 10 years). A “qualifying payment” is one that is (1) made on Direct federal student loans, (2) under a qualifying repayment plan – which is either the 10-year Standard plan or an income-driven repayment plan, while (3) working full-time for a qualifying public service employer.Read More

7 Student Loan Tax Tips for 2018

| Articles Current Events Income-Based Repayment Income-Driven Repayment Loan Forgiveness Pay-As-You-Earn Policy & Reform Student Loans 101 Taxes

What’s more stressful than student loans and taxes? Not much. But don’t get paralyzed. Here are some tips to guide you as we enter the height of tax season.

Student Loan Interest Is Still Tax Deductible

For many years, the tax code permitted many borrowers to claim a portion of their student loan interest paid as a deduction on their tax return. This deduction was threatened during the congressional battle over the tax bill last year. However, the final version of the tax bill preserved this tax deduction. So if you received a 1098-E statement issued by your student loan lender (which would show the amount of interest that you paid during 2017), you may still be able to claim some of that as a deduction. Remember that the deduction is capped, however, and is also phased out for higher income earners.Read More