Uncle Sam Steps in to Counsel Students with Overpriced Commercial Loans
For years, college financial aid officers have known about the excessive interest rates that banks and other lending institutions sometimes charge on student loans. They have also known that loan programs funded by the U.S. government generally charge lower rates and are a much better choice for most students who need to borrow to pay their educational costs.
The problem has been that students are often unaware that commercial loans tend to be a lot more expensive. They walk into a bank or respond to an ad, and end up taking loans that charge much higher interest or impose steeper penalties for late payments or default. They don’t read the fine print on loan agreements, or don’t understand it if they do.
But now the government is stepping in. Here’s what you need to know . . .
The Consumer Financial Protection Bureau, a federal agency, has just opened a new online complaint center that is dedicated to addressing the problems of students who have borrowed unwisely. CLICK HERE to see what it offers. Or if you prefer, you can call the Bureau toll-free at 1-855-411-CFPB.
The center is dedicated to remedying problems that student borrowers have experienced with lending companies, loan servicers, and even debt collection agencies.
What will the complaint system do for you? To quote from its website . . .
“If you file a complaint, we’ll work with your lender or servicer to get a response. While we certainly can’t make your debt disappear, we can help bring your concern to your financial institution’s attention.”
The Consumer Financial Protection Bureau also plans to launch a new online service that will help students make wiser choices about borrowing.
In summary . . .
If you made a bad decision and took the wrong loan, you now have an advocate who will try to help you improve your situation. And if you haven’t taken any loans yet, the government will soon offer information that can help you pick the right one. These are great services for Uncle Sam to offer, don’t you agree?
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