| Adam S. Minsky, Esq. Articles Current Events Income-Based Repayment Income-Driven Repayment Loan Forgiveness Pay-As-You-Earn Policy & Reform
News outlets are reporting that the House GOP has drafted legislation that could reshape the entire federal student loan system.
The bill is called the “Promoting Real Opportunity, Success and Prosperity Through Education Reform Act,” or the “PROSPER Act.” The full text of the proposed bill has not yet been released, but an outline of the proposal was released to the media. Here’s what we know (and what we don’t know):Read More
| Adam S. Minsky, Esq. Articles Current Events Policy & Reform Taxes
Late this week, the House GOP unveiled its much-anticipated tax reform bill. The bill makes a lot of reforms to the tax code for both individual and corporate taxpayers. There are some major changes proposed for student loan borrowers.
First, the bill eliminates the student loan interest deduction. Currently, individuals earning an income of up to $80,000 per year (or $160,000 for married couples filing jointly) can deduct up to $2,500 per year in interest paid on their student loans, although the benefit begins to get phased out once an individual hits $65,000 per year in income. There are over 44 million student loan borrowers in the United States, and an estimated 12 million of them claim this deduction. Read More
BREAKING NEWS – Two of the largest student loan servicers in the country have just announced a merger. Nelnet will be purchasing Great Lakes Higher Education for $150 million.
Currently, the U.S. Dept. of Education contracts out servicing operations to four primary companies: Nelnet, Great Lakes, FedLoan Servicing (part of the Pennsylvania Higher Education Assistance Authority, or PHEAA) and Navient. These servicers also manage private loans on top of their federal student loan portfolios. Assuming the merger is approved, the combined Nelnet-Great Lakes entity would become the largest student loan servicer in the country.
What is fascinating about this – and, arguably, quite troubling – is that while student loan servicing remains atrocious, Great Lakes generally has the fewest customer complaints of the four major U.S. Dept. of Education servicing companies. Great Lakes is also the only nonprofit servicer of the four. If this merger is approved, Great Lakes will effectively cease to exist, as it will become part of Nelnet. That will leave only three major servicing companies handling Direct federal student loans, two of which are currently subject to major lawsuits for systematic servicing problems (Navient and FedLoan Servicing/PHEAA). Read More
| Adam S. Minsky, Esq. Articles Current Events Default Private Student Loans
This is a developing story.
The federal Consumer Financial Protection Bureau (CFPB) has reached a major enforcement agreement with National Collegiate Student Loan Trust, the holder of hundreds of thousands of student loan accounts, about its debt collection practices. This agreement has the potential to impact thousands of student loan borrowers across the country.
National Collegiate Trust (“NCT”) is a collection of individual trust entities that purchased hundreds of thousands of private student loan accounts from commercial lenders (mostly banks) through securitization. In other words, banks bundled many private student loan accounts together, and then sold the bundles to NCT. When student loan borrowers with NCT-purchased accounts became unable to pay, NCT aggressively pursued these borrowers through private debt collectors and litigation.Read More
| Adam S. Minsky, Esq. Articles Current Events Income-Driven Repayment Student Loans 101
It’s a scary time for millions of Americans right now. Much of eastern Texas has been declared a disaster area following Hurricane Harvey. Puerto Rico and the U.S. Virgin Islands have been declared disaster areas as well following Hurricane Irma, and the southeastern U.S. (especially Florida) may be next. The last thing anyone in those areas is thinking about right now is student debt. But what happens to your student loans when a disaster strikes?Read More
| Adam S. Minsky, Esq. Articles Current Events Income-Driven Repayment Loan Forgiveness
Yesterday, Massachusetts Attorney General Maura Healey filed a lawsuit against loan student servicing giant FedLoan Servicing (formally known as the Pennsylvania Higher Education Assistance Authority, or “PHEAA” for short). The lawsuit alleges widespread loan servicing problems that have harmed thousands of borrowers. The allegations against FedLoan Servicing are entirely unsurprising to me, as I’ve written extensively about ongoing problems with this student loan servicing company. But this is a major development and represents an important step in holding student loan servicers accountable for their actions.
Here are some common questions I’m getting about the lawsuit – and my answers.Read More
| Adam S. Minsky, Esq. Articles Current Events Loan Forgiveness Policy & Reform
Public Service Loan Forgiveness (PSLF) is a program that allows borrowers to have any remaining balance on their federal Direct student loans forgiven after 120 “qualifying payments” (typically under an income-driven repayment plan). Borrowers must work full-time for a public service employer to qualify. For hundreds of thousands (if not millions) of student loan borrowers, it is a critical program that allows people to work in traditionally low-paying sectors that often require advanced degrees.
The PSLF program has been in the news a lot lately, however, and not in a good way. There’s been talk about changing or eliminating the program. There’s been news about the U.S. Dept. of Education denying people access to the loan forgiveness benefit. And no one has been granted forgiveness yet under the program. There’s a lot of uncertainty, which is understandable given PSLF’s complexity and the constant stream of news stories.
So let’s take a moment and review where things are.Read More
| Adam S. Minsky, Esq. Articles Current Events Policy & Reform
Yesterday, I testified at the Massachusetts State House in support of the “Student Loan Bill of Rights,” which would introduce new statewide protections for student loan borrowers in Massachusetts. Below is my testimony.
If you live in Massachusetts, contact your state representative and state senator and ask them to support the Student Loan Bill of Rights.
Dear Honorable Chairs of the Joint Committee on Consumer Protection and Professional Licensure:
I am writing to you today in support of S129, the “Student Loan Bill of Rights,” sponsored by Senator Eric Lesser.
By way of background, I am a solo-practicing attorney with a uniquely-focused practice devoted entirely to helping student loan borrowers. To my knowledge, I am the only such attorney in the Commonwealth of Massachusetts – and one of the only in the country – specializing in this area of law. I have a unique perspective on the student loan crisis, particularly as it impacts student loan borrowers here in our Commonwealth.Read More
| Adam S. Minsky, Esq. Articles Current Events For-Profit Colleges Loan Forgiveness Private Student Loans
Happy summer, everyone. With all the big national news going on lately, there’s a lot of developments in student loan law and policy that are flying a bit under the radar. Let’s bring everyone up to speed.
Starting July 1, the three major credit bureaus (Equifax, Experian, and TransUnion) will no longer report civil judgments on people’s credit reports. There have been ongoing concerns about credit reporting errors for judgments, since a judgment is often not linked to a person’s social security number. This is a significant change that will have a direct, positive impact on borrowers who have been sued by their student loan lenders.Read More
| Adam S. Minsky, Esq. Articles Current Events Income-Based Repayment Income-Driven Repayment Loan Forgiveness Pay-As-You-Earn Policy & Reform
It’s been a whirlwind week. Last week’s leaked budget documents from the Trump administration showed proposed cuts to critical student loan programs including Public Service Loan Forgiveness, as well as major changes to income-driven repayment plans. The proposals sparked panic; hundreds of thousands of student loan borrowers have made major life decisions – selecting specific careers and specific repayment plans – in reliance on the continued existence of these programs. To have the rug pulled out from under them would be disruptive and unfair, and would likely be the basis of viable legal challenges.
After just a few days, we have some important updates on some of these reforms. Some good news, and some bad. Read on.Read More
