Education Secretary Betsy DeVos Just Removed Some Huge Consumer Protections for Student Loan Borrowers
“The 56-page memo [pdf] called for the creation of financial incentives for targeted outreach to people at great risk of defaulting on their loans, a baseline level of service for all borrowers and a contract flexible enough to penalize servicers for poor service, among other things.
The Obama administration requested routine audits of records, systems, complaints and a compliance-review process. It also directed Runcie’s team to base compensation on response time to answering calls, completing applications for income-driven repayment plans, errors made during communications and the amount of time it takes to process payments. Another memo insisted [pdf] FSA consider a company’s past performance in divvying up the student loan portfolio.”