Biden’s Plan for Student Loans Attracts Lawsuits, Scams and Confusion

Administration officials have said they were aware of requests for a multilingual application process but have not said whether one will be available.

In an email to 5 million people who had signed up for updates, the Education Department on Thursday that it would start sending weekly updates and that “a short online application” would be available beginning in October. Borrowers must earn less than $150,000 as individuals or $250,000 as a household to be eligible for $10,000 in federal student loan relief — or up to $20,000 if they received a Pell grant.

“There are big open questions about how people are going to connect the dots,” Mike Pierce, the executive director of the Student Borrower Protection Center, said in an interview. “But the track record for the student loan system isn’t good. In some ways, all the White House is doing here is reflecting the reality that the student loan system doesn’t provide people with a path to get their debts canceled 100 percent of the time.”

In an email, Kelly Leon, a Department of Education spokeswoman, said the administration “has consistently put strong emphasis on implementation across all of its priorities,” adding that the administration’s goal is to “provide borrowers a seamless and simple experience.”

Still, call centers and loan services have been flooded with calls from anxious and confused borrowers.

Scott Buchanan, the executive director of the Student Loan Servicing Alliance, a trade group representing loan servicers, said that since the program was announced, it has not been uncommon for call centers to begin the day with at least 2,000 people waiting to speak to someone who might have more information. There is little for servicers to do, he said, but encourage callers to sign up for Department of Education email updates.

As borrowers wait, debt forgiveness activists and loan servicers say misinformation is mushrooming and scammers are proliferating.

Article source: https://www.nytimes.com/2022/09/30/us/politics/biden-student-loans.html