The U.S. Department of Education yesterday outlined a series of enhanced protections and customer service standards to guide the future of federal student loan servicing practices. The policies were outlined in a memorandum to Federal Student Aid (FSA) and developed in consultation with the Department of the Treasury and the Consumer Financial Protection Bureau.
The new system includes:
- Department of Education-branded communication that is standard–eliminating differences that now exist among multiple servicers that co-brand borrower communications–and that will help borrowers stay on top of their debt and avoid confusion about who is servicing their loan.
- A streamlined borrower experience via a single web portal through which all borrowers can find the latest information about their loans, make payments and apply for benefits–eliminating the need to know the name of their servicer.
- Better customer service practices that will be common for all borrowers and that meet high standards to ensure borrowers’ needs are met consistently, regardless of what contractor is providing that customer service.
- Reduced, and, to the extent practical, eliminated loan transfers and other borrower disruptions that can make it hard for borrowers to keep current with their loan payments and seek help when they need it.
- Enhanced oversight and accountability that will ensure that borrowers are treated fairly and given clear, actionable information at every step of the repayment process, including enhanced customer service practices and a new complaint system to empower borrowers when something is not right.
- A single platform for all Federal student loans allowing for a more seamless connection for future customer service centers.
The Department is also launching an FSA Feedback System for borrowers with complaints about student loans or institutions of higher education.