March 30, 2016

Senator Warren Calls on Department of Education to Implement Five Fundamentals to Reform Student Loan Servicing

"Everyone in Government Who Is Serious About Standing Up ... For Student Loan Borrowers ... Should Embrace Them”

Fact Sheet: Five Student Loan Servicing Reform Fundamentals (PDF) 

Washington, DC – Senator Elizabeth Warren has called on the U.S. Department of Education (ED) to implement five fundamentals to reform federal student loan servicing, following a recent ED Office of Inspector General (OIG) report identifying significant flaws in the Department’s 2015 review of Navient’s and other servicers’ compliance with the Servicemembers Civil Relief Act.

“When a private company breaks the law and steals from American soldiers who are literally in the field fighting overseas, those companies should be held accountable… But the Department of Education's bank decided it was more important to protect Navient than to watch out for our military students,” Senator Warren said. “One of the first things that must be done is a total reform of student loan servicing to make sure nothing like the Navient disaster ever, ever happens again.” 

The five fundamentals Senator Warren identified in reforming federal student loan servicing are:

  1. Put students and families first - every time, every decision
  2. Punish bad actors
  3. Change the financial incentives for servicers
  4. Release more data
  5. Conduct aggressive oversight 

“Five simple principles. Everyone in government who is serious about standing up for the tens of millions of student loan borrowers in this country should embrace them because we shouldn't be running the student loan program to create profits for private companies. We should run it for students,” Senator Warren said.

A PDF fact sheet detailing the five student loan servicing fundamentals is available here, and a video of Senator Warren explaining these fundamentals is available here.