Education Department Beats out Debt Collectors in Student Loan Collection Battle


August 6, 2019 11:49 AM
by Susan Dutca-Lovell
A U.S. Federal Judge paved way for the Education Department to halt usage of private debt collectors and overhaul the existing federal student loan program by consolidating loan servicing and default collection efforts.

A U.S. Federal Judge paved way for the Education Department to halt usage of private debt collectors and overhaul the existing federal student loan program by consolidating loan servicing and default collection efforts.

Rather than having private collection agencies solely dedicated to recovering past-due student loans, the Education Department will hand over those duties to companies that service the loans. Those companies will be in charge of helping borrowers before they end up defaulting on their loans, a strategy that is part of a broader overhaul of the federal student loan program, dubbed the Next Generation Financial Services Environment, or NextGen. Critics of private collection agencies have long argued that the agencies pursue collection at all costs, with no consideration for providing borrowers with sustainable solutions to managing their debt. By consolidating loan servicing and default collection efforts, companies would be required to compete for the business to "provide a wide array of services or team up with other firms." Private debt collection agencies still maintain that the Education Department "arbitrarily restricted competition and illegally canceled a contract solicitation they were vying to win."

U.S. Court of Federal Claims Judge Thomas C. Wheeler claims the Education Department "provided sufficient justification for consolidating loan servicing and default collection work" and that it was "within its right to cancel the collection contract solicitation in light of its rollout of NextGen." However, he criticized the Department's "messy bid" for new contractors to manage its $1.5 trillion portfolio of student loans. "There is no such thing as a perfect procurement, and the Department of Education's years-long series of student loan servicing and debt collection solicitations typifies the axiom. But a flawed procurement is not necessarily an illegal one," Wheeler stated in his ruling.

Getting more college financial aid doesn’t have to be a relentless search. Scholarships.com is totally free. Connect with our massive database of millions of college scholarships at any time by searching for awards in a variety of ways. Scholarships.com offers the quickest and easiest way to search for, apply to, and win college scholarships. Start making your college education affordable or perhaps even free, by conducting a free college scholarship search at Scholarships.com.

Discuss

Share your thoughts and perhaps thousands of students will benefit from your unique insight on the subject!



If you can read this, don't touch the following fields


 

Amanda A  on  8/7/2019 2:56:11 PM commented:

Amen

Gucci is releasing a new line of... diversity undergraduate scholarships for students who are traditionally underrepresented in the fashion industry. The 1.5 million U.S. university college scholarship program is set to run for four years, targeting students who attend four-year universities. Special consideration will be given to those residing in Atlanta, Chicago, Detroit, Houston, Los Angeles, Miami, New Orleans, New York, Philadelphia, San Francisco, Toronto and Washington, D.C and/or for those who plan to attend or are currently attending a Historically Black College and University (HBCU).

Gucci Gaffe Results in Green for Grads

October 8, 2019 2:28 PM
by Susan Dutca-Lovell
Gucci is releasing a new line of... diversity undergraduate scholarships for students who are "traditionally underrepresented in the fashion industry." The 1.5 million U.S. university college
Not every student who goes to college completes their degree, much less finishes it within the normal four-year time frame. The Texas of A&M University has spent years working to re-enroll students who stopped out of college for a year or more, and may have found a solution in partnering with ReUp Education.

Texas A&M Working to Re-enroll College Stopouts

September 26, 2019 2:15 PM
by Susan Dutca-Lovell
Not every student who goes to college completes their degree, much less finishes it within the "normal" four-year time frame. The Texas of A&M University has spent years working to re-enroll students
 Photo credit: Jared Ames

A new PBS documentary exhibiting prison education, titled College Behind Bars is set to air on November 25 and 26. The four-part series documents the journeys of dozens of incarcerated men and women as they pursue college degrees in the Bard Prison Initiative - deemed one of the most rigorous prison education programs in the United States, according to Inside Higher Ed.

PBS Airs Documentary About Higher Ed in Prison

September 18, 2019 11:53 AM
by Susan Dutca-Lovell
Photo credit: Jared Ames A new PBS documentary exhibiting prison education, titled "College Behind Bars" is set to air on November 25 and 26. The four-part series documents the journeys of dozens
The federal government discharged more than $43 million in student loan debt for former students of recently closed for-profit colleges. Students who attended programs operated by Education Corporation of America, Dream Center Education Holdings, Vatterott College and Charlotte School of Law will be able to qualify for a full discharge of their federal loans if they were enrolled when their college closed or withdrew within 120 days of the official closure date and didn’t transfer to another institution, according to Inside Higher Education.

$43M in Loans Forgiven for Students of Closed Colleges

September 6, 2019 9:18 AM
by Susan Dutca-Lovell
The federal government discharged more than $43 million in student loan debt for former students of recently closed for-profit colleges. Students who attended programs operated by Education
College Board is ditching its previous plan to capture socioeconomic information from students with a single score - also known as an adversity score - when scoring their SAT college admissions test. The score would have taken into account a student's socioeconomic background and the neighborhood in which they grew up.

College Board Backpedals - No Adversity Score to be Added

August 30, 2019 2:05 PM
by Susan Dutca-Lovell
College Board is ditching its previous plan to capture socioeconomic information from students with a single score - also known as an "adversity score" - when scoring their SAT college admissions
Female-only college and university STEM programs are coming under fire for male discrimination as they attempt to redress gender imbalance in fields such as computer science and engineering. The U.S. Department of Education launched more than two dozen investigations into higher education institutions nationwide - including UC Berkeley, UCLA and USC as well as Yale, Princeton and Rice - which offer female-only scholarships, awards and professional development workshops.

Female-Only Scholarships Under Fire In Higher Ed

August 20, 2019 4:57 PM
by Susan Dutca-Lovell
Female-only college and university STEM programs are coming under fire for male discrimination as they attempt to "redress gender imbalance" in fields such as computer science and engineering. The
Dozens of suburban Chicago families have been using a legal loophole to help their children get need-based college financial aid and scholarships. By their parents' forfeiting legal guardianship, students are able to declare financial independence so they qualify for federal, state and university financial aid.

Parents Giving Up Guardianship for College Cash?

July 30, 2019 9:24 AM
by Susan Dutca-Lovell
Dozens of suburban Chicago families have been using a legal loophole to help their children get need-based college financial aid and scholarships. By their parents' forfeiting legal guardianship,
An Iowa Carpenter sent 33 Iowan students he'd never met to college with the $3 million he had in savings. Prior to his death in 2005, Dale Schroeder told his attorney that he wanted to use the money in his will help send underprivileged students to college. Schroeder's scholarship recipients, also known as Dale's Kids, recently met up to reflect on his generosity and the fact that many of them would have been unable to attend college without Schroeder's help.

Carpenter Comps College Costs for 33 Iowans

July 23, 2019 3:50 PM
by Susan Dutca-Lovell
An Iowa Carpenter sent 33 Iowan students he'd never met to college with the $3 million he had in savings. Prior to his death in 2005, Dale Schroeder told his attorney that he wanted to use the money