People are having a difficult time enrolling in the government’s most generous student loan repayment plan as the companies hired to manage the process contend with a backlog of applications, according to consumer advocates.
It’s been almost four months since the Obama administration rolled out the repayment plan, known as Revised Pay as You Earn or REPAYE, which caps monthly bills to 10 percent of borrowers’ income and forgives the debt after 20 years of payment. Before then, those terms were only available to people with very low income relative to their debt and who took out loans after 2007. Now anyone with a direct federal loan, regardless of their income or when they borrowed, can take advantage.
But consumer advocates say student loan servicers, the middlemen who collect and apply payments on the government’s behalf, have been unprepared for the volume of applications, leading to months of processing delays and backlogs.
Read more at The Washington Post: https://www.washingtonpost.com/news/grade-point/wp/2016/04/05/delays-backlogs-confusing-applications-obamas-latest-student-loan-plan-is-having-growing-pains/