U.S. Regulator to Keep an Eye on Largest Student Loan Servicers.

[elleng]

Source: nyt/reuters

The U.S. consumer financial watchdog will soon start supervising the seven largest student loan servicers to ensure they treat borrowers fairly and comply with federal consumer laws, the agency said on Tuesday.

The Consumer Financial Protection Bureau has taken a broad interest in the burden of student loan debt, which it says now totals $1.2 trillion and saddles many borrowers with debt that takes years to repay.

More than 40 million borrowers with non-bank student loan debt depend on companies that manage borrowers' accounts and process payments.

The agency said it has found a concerning resemblance of problems encountered by student loan borrowers dealing with servicers and those faced by homeowners dealing with mortgage servicers.



Read more: http://www.nytimes.com/reuters/2013/12/03/business/03reuters-usa-studentloans-cfpb.html?hp

[kristopher]

1. 10 largest student loan servicers as of 2008

http://studentlendinganalytics.typepad.com/student_lending_analytics/2010/03/who-are-ten-largest-ffelp-servicers.html

Top FFELP Loan Servicers (as of December 31, 2008)

Rank

Name

$ millions


1 Sallie Mae
178,191

2 AES/PHEAA
60,063

3 ACS Education Services (formerly reported under AFSA)
55,600

4 Great Lakes
41,554

5 Nelnet
35,889

6 Citibank, The Student Loan Corporation
24,889

7 Wells Fargo Education Financial Services
18,064

8 EdFinancial Services
9,779

9 Xpress Loan Servicing
8,996

10 Kentucky Higher Education Student Loan Corporation
8,186

Source: 2009 SLSA Servicing Volume Survey and company filings


Also see Gov Fact Sheet, "CONSUMER FINANCIAL PROTECTION BUREAU PROPOSES RULE TO OVERSEE NONBANK STUDENT LOAN SERVICERS"
http://files.consumerfinance.gov/f/201303_cfpb_fact-sheet_larger-participants-student-loan-servicing.pdf

[Spitfire of ATJ]

2. I know someone who had been paying $60 a month for over 7 years on a $3,500 loan...

...only to find out they weren't using ANY of that money towards the principle.

These student loan collection agencies feel they have a license to steal.

[Jimbo S]

3. That comes to 20% interest

That doesn't sound right but if is, wow.

[Spitfire of ATJ]

4. Like I said,...they never used any of what they took towards the loan.