NEW YORK (MainStreet) — The Consumer Financial Protection Bureau has added private student loans to the list of financial products it will target for reforms, and the agency wants to hear your complaints.
Starting Monday, borrowers can contact the CFPB for help with any problems that arise from taking out or repaying their private student loans. They can also contact the bureau about student loans that have gone into default and may have been referred to a debt collector.
“The ability to work hard and better yourself through education is part of what makes this country so great,” Richard Cordray, director of the CFPB, said in a press release. “But getting a higher education can mean taking on significant debt, a big decision with a lot of consequences. The CFPB is now the one-stop federal agency where all private student loan borrowers can ask questions, get information and file a complaint about this important market.”
The CFPB is targeting private student loans because they've been regulated by a patchwork of state and federal authorities. Also, these loans generally do not offer the same borrower protections as federal student loans, which include military deferment, discharges upon death or income-based repayment plans.
The bureau says it anticipates disputes involving difficulties making full payments, confusing advertising or marketing terms, billing disputes, deferment and forbearance issues and debt collection and credit reporting problems.
Financial institutions must outline the steps they plan to take to address a complaint within 15 days of its submission, and the CFPB expects most complaints to be closed within 60 days. Consumers who file complaints will be given a tracking number to check its status on to the CFPB website.
They will have the option to dispute the lender’s resolution once it has been submitted.
The CFPB has been taking complaints about certain financial products and services since it launched officially in July. Just this month, it announced it would hear complaints regarding checking accounts, in addition to existing financial products that the agency is overseeing, including credit cards, mortgages and other home loans.
Anyone interested in filing a student loan complaint (or any other under the agency’s purview) can do so on the CFPB’s website. You can also call the bureau at 1-855-411-2372, send a fax to 1-855-237-2392 or mail a letter to P.O. Box 4503, Iowa City, Iowa 52244.
What’s the next step for the CFPB? The agency has proposed monitoring credit reporting agencies, and MainStreet took a look at 3 Ways the CFPB Can Improve the Credit Reporting Process. Check it out!