July 08, 2021

Yahoo Finance: Sen. Warren says borrowers can 'breathe a sigh of relief' after major servicer drops out of federal student loan program

The Pennsylvania Higher Education Assistance Agency (PHEAA) — a national student loan servicer that has been criticized for failing to forgive the debts of public servants — is planning to exit the federal student loan servicing business in December of this year.

PHEAA, which administers the Public Service Loan Forgiveness (PSLF) program and operates as FedLoan Servicing, has notified the Education Department (ED) that it would not seek a renewal of a 12-year federal student loan servicing contract, which expires on Dec. 14, 2021.

"Millions of loan borrowers can breathe a sigh of relief today knowing that their loans will no longer be managed by PHEAA, an organization that has robbed untold numbers of public servants of debt relief and was recently caught lying to Congress about its atrocious record of fines and penalties," Senator Elizabeth Warren (D-MA), who has called on ED previously to fire PHEAA, told Yahoo Finance, in an emailed statement.


Read the full article here

By:  Aarthi Swaminathan
Source: Yahoo Finance