The year is just beginning, but we’re already on track to see some noteworthy student-loan-related issues during 2014. Here are some highlights:

• Higher Education Act Reauthorization. The Higher Education Act (HEA) is the massive piece of legislation that governs much of the federal student loan system. It has to be periodically renewed by Congress, and it’s up for renewal this year. Traditionally, Congress has dragged its feet on reauthorization, and given the current political climate, I expect that will occur this year, as well. But the reauthorization of the HEA is a significant opportunity to inject some new programs and reform into the student loan world. It will be interesting to see what happens.
• Greater scrutiny of federal loan servicers. With contracted federal loan servicing companies coming under increasing criticism for poor customer service and failure to advise borrowers of their options, the Consumer Financial Protection Bureau’s recentannouncement that it would be closely monitoring these companies comes as a welcome surprise. We’ll see if this yields positive results.
• Higher Interest Rates. The recent student loan interest rate bill signed into law in 2013 lowered interest rates for many federal student loan borrowers after they had doubled due to a lapse in a prior law. However, the interest rate benefits of this law will be short lived, and this year I think we will start to see interest rates begin to climb again. This was a short-term, politically expedient solution with predictably nasty longer-term consequences for new borrowers, and we’ll begin to see that this year.
• Modest Relief for Defaulted Federal Borrowers. New federal regulations go into effect later this year that will allow borrowers burdened by federal default and wage garnishment to climb out of default a little more easily. It still won’t be easy, but it will hopefully be an improvement. Will debt collectors contracted with the Dept. of Education comply with the new rules? We’ll certainly find out this year.