Similar issues arose with the Public Service Loan Forgiveness (PSLF) program, which is intended to forgive student debt for government and nonprofit workers after ten years of qualifying payments. According to the report, payments toward forgiveness were inaccurately tracked, and borrowers were wrongfully denied relief because the servicer claimed the applications were incomplete, when that was not the case. Additionally, at least one servicer was found to have "excessively delayed processing PSLF forms," putting borrowers significantly off track toward relief — with the same thing happening to those enrolled in income-driven repayment plans…
Wednesday, October 5, 2022
Student-Loan Companies Have 'Illegally Hampered' Debt Relief: CFPB
"These wrongful denials resulted in substantial injury to consumers because they either lost their loan forgiveness or had their loan forgiveness delayed," the report said, noting that oftentimes the borrowers who were denied may have refrained from submitting another application to get the debt relief.
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