Government watchdog investigating discrimination in student loan servicing
The Consumer Financial Protection Bureau said Friday that it is investigating whether loan servicing companies are making it difficult for people with past-due student debt to work out a solution because of their race, ethnicity, gender or age.
"We’re looking at disparities in outcomes … and we believe there may be some," Patrice Alexander Ficklin, director of the office of fair lending at the CFPB, said on a call with reporters Friday.
She said her team has identified student loan servicing as an area with substantial risk of credit discrimination. Although Ficklin would not explicitly say how the CFPB reached that conclusion, she said her office decides what to prioritize based on consumer complaints, tips from advocacy groups and data analysis.
The CFPB will evaluate discrimination in the servicing industry by comparing outcomes for all student loan borrowers who are in default on federal and private education loans. Ficklin said the bureau has already zeroed in on servicers it views as high risk, but would not disclose names. The bureau has jurisdiction over the largest servicing companies, including Navient, Great Lakes and American Education Services.
Read more at The Washington Post: https://www.washingtonpost.com/news/grade-point/wp/2017/04/14/government-watchdog-investigating-discrimination-in-student-loan-servicing/