Sen. Elizabeth Warren and three other liberal senators are raising concerns about how the Department of Education and federal student loan servicers are handling the return of student loan payments after a three-plus year, pandemic-related pause.
The U.S. Education Department will press forward with a "secret shopper" program to help ensure that companies properly service student loans as millions of borrowers begin repaying debt that had been put on hold during the pandemic. "As we're bringing folks back onto repayment, we need to make sure that the servicers are doing it well, and that they're responsive to the needs of the borrowers and when they're not, we're going to hold them accountable," Education Secretary Miguel Cardona told the Reuters NEXT conference. Under the so-called secret shopper program, Cardona said, the Education Department will send its employees to go through the loan process as if they are borrowers.
The Department of Education announced Monday that it is withholding millions of dollars in payment to the student loan servicer Missouri Higher Education Loan Authority (MOHELA) over billing statement errors it made. The department said MOHELA “failed to meet its basic obligation” of getting the statements out in a reasonable timeframe, resulting in 2.5 million…