The Consumer Financial Protection Bureau (CFPB) has released a scathing new report on the student loan servicing system, with a particular focus on borrowers having difficulty accessing income-driven repayment plan programs like Income-Based Repayment (IBR), Pay As You Earn (PAYE), and Revised Pay As You Earn (REPAYE).

Based on complaints submitted by consumers, the CFPB is confirming what many of us already know: that student loan servicing problems impede the ability of student loan borrowers to access programs to repay their loans, and widespread bureaucratic delays and errors lead to  negative consequences for people. The CFPB’s report echoes my recent article highlighting the widespread problems with one of the biggest federal student loan servicers, FedLoan Servicing/PHEAA.

Here are some of the highlights from the report: 

• Borrowers repeatedly “encounter obstacles when submitting applications for IDR plans, including poor customer service, unexpected delays, lost paperwork, and inconsistent or inaccurate application processing.”
• The CFPB notes that there are “servicing problems at every step of the IDR lifecycle,” including the initial application process and annual income re-certification.
• Student loan borrowers “seeking to apply online (for income-driven repayment programs) report encountering costly and cumbersome delays” that can last weeks or months.
• The CFPB has fielded “complaints from otherwise eligible borrowers describing differing approaches to addressing incomplete applications, depending on the identity of their servicer. Borrowers report that servicers reject borrowers’ applications without providing borrowers the opportunity to fix mistakes or update documentation.”

The report also highlights consumer complaints about private student loan servicing, with a particular focus on Navient, which accounted for a whopping 63% of all borrower complaints about private student loan servicing. American Education Services – AES /PHEAA (the parent entity of FedLoan Servicing) came in second place.

The CFPB report concludes with some recommendations for streamlining some of the most common servicing problems, including income-driven repayment. But obviously, we need a complete overhaul of the entire student loan servicing system – if this report isn’t proof of that, I don’t know what is.

Read the report for yourself. And if you have had a student loan servicing problem, please tell the CFPB!