FILE- In this June 15, 2018, file photo, twenty dollar bills are counted in North Andover, Mass. Default on your federal student loans and the government can take up to 15 percent of each paycheck to satisfy your debt. The Education Department can also withhold federal benefits like tax returns and Social Security payments. Garnishment is an effective tool to recoup unpaid loans, private collection agencies enlisted by the Education Department took in over $841.6 million via wage garnishment in the 2018 fiscal year, but it inflicts serious financial strain on borrowers who are already struggling. (AP Photo/Elise Amendola, File)

New report says massive problems with student loan servicers

A new report uncovers massive problems in the way companies are collecting graduates’ money across the nation.

U.S. Department of Education’s inspector general issued a report that shows nine companies┬áservicing student loans repeatedly failed to do their jobs properly for years.

Last week, WINK News reported about the massive debt students are facing after college. Another discovery shows students may not be receiving accurate information when it comes to re-payment.

Student loans are big business. In fact, it’s a $1.5 trillion business, and the government didn’t hold the companies detailed in the report accountable.

Two of the biggest recurring problems

  • Loan servicers failed to tell people about repayment options.
  • And miscalculated people’s monthly payments.

While the government organization overseeing the student loan servicers disagrees with the report, it did agree to follow the report’s recommendation.

 

Reporter:Allison Gormly
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