Petition opposing DeVos student loan overhaul gets 18K signatures

A petition asking Education Secretary Betsy DeVos not to consolidate the nation’s federal student loan service providers has gathered over 18,000 signatures.

DeVos announced in May that her agency will select just one company to collect student debt payments on the federal government’s behalf, instead of the nine contractors that currently handle the country’s $1.2 trillion student loan debt.

The department estimated the move will save taxpayers more than $130 million in the first five years of the contract.

{mosads}The petition circulated by Care2 says borrowers are unhappy with the administration’s plan to create what they call a monopoly on student loan debt. 

“These service providers are hard enough to deal with as-is,” the petition says. “There is bureaucracy and a number of issues in trying to get the information we need to pay off our loans. A headache awaits us if just ONE company were to handle the massive amount of borrowers and debt.”

The petition also asks Devos not to do away with the requirement that servicers must notify borrowers a few weeks in advance when it’s time to re-certify their income-driven repayment plans.

“This means if you’re a borrower, are unaware of the deadline and don’t re-certify, your monthly payments could go up astronomically without your prior knowledge,” the petition says. “While the monopolistic servicer might still notify people of their own volition, they stand to make a lot more money if they don’t.” 

The Education Department’s nine federal student loan service providers are CornerStone, FedLoanServicing, Granite State, Granite Lake Educational Loan Services Inc., HESC/Edfinancial, MOHELA, Navient, Nelnet and OSLA Servicing.