Following recent scrutiny from Congress and the Obama administration, private companies that service student loans for the federal government are about to face new rules from the Consumer Financial Protection Bureau.
Under the new regulations introduced in July, debt collectors would be limited in the ways they can contact borrowers in an effort to curb abuse and harassment. For example, debt collectors could be prevented from calling borrowers more than a half-dozen times a week and likely would have to document that the debt they are trying to collect is legitimate before contacting borrowers.
Student loan servicers have drawn criticism from the government, after federal regulators including the bureau warned in September of “widespread problems” in the student loan industry.
Among the bigger issues is that millions of borrowers have had their debts transferred between servicers with little notice and that millions of borrowers have fallen into default despite the availability of federal programs that offer income-based repayment plans.
Nearly 4 million people with federal student loans are in default, according to the Department of Education. This year, the consumer bureau has received almost as many complaints about servicing of federal student loans as it has for private student loans.
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For borrowers who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.