CABINET/EDUCATION/TRUMP PEOPLE/BETSY DEVOS: “The Department of Education said Friday [5-19-17] that it will select one company to collect student debt payments on its behalf, rather than the nine contractors that currently handle the federal government’s $1.2 trillion portfolio of education loans.
The decision, which would take effect once the existing contracts expire in 2019, reverses years of policy implemented by the Obama administration and would revive a servicing model that had an equal number of benefits and problems.
‘We can better monitor the performance of one servicer and one platform,’ James Manning, acting undersecretary of education, said on a call with reporters Friday.
Education officials are in the middle of issuing new contracts to student loan servicing companies responsible for placing borrowers in affordable repayment plans and keeping them from defaulting on their loans. The previous administration included contract requirements to shore up the quality of servicing in response to consumer complaints over poor communication, mismanaged paperwork and delays in processing payments. But servicing companies said the demands would be unnecessarily time-consuming, not to mention expensive.”
-Danielle Douglas-Gabriel, “Betsy DeVos hits hard reset on student loan servicing contracts,” The Washington Post online, May 19, 2017 5:25pm