Democrats are calling on Secretary of Education Betsy DeVos to weigh “any consequences or penalties” she can level against a student loan company that committed several errors during the coronavirus pandemic, causing additional difficulties for the administration.
Great Lakes Educational Loan Services erroneously suspended borrowers whose payments had been suspended automatically by the CARES Act, claiming that they had deferred on their federal student loans despite the fact that the CARES Act requires loan companies to report these loans as if the borrower had been keeping up with their regular payments.
“It is difficult to know how far reaching the consequences of this error will be for millions of borrowers who might attempt to purchase a home, start a new job, or take out a loan to stay financially afloat during this economic crisis,” a group of Senate Democrats, led by Massachusetts Sen. Elizabeth Warren, wrote in a letter to DeVos, according to Politico. The other senators to sign the letter include Richard Blumenthal, D-Conn., Sherrod Brown, D-Ohio, Dick Durbin, D-Ill., Jeff Merkley, D-Ore., and Tina Smith, D-Minn.
A spokesperson for the Education Department, Angela Marabito, told Politico: “How is this news? There is nothing new said in the letter, and the problem is already being resolved.”
She added that the error was “totally unacceptable,” and said that the company “quickly corrected the coding issue” and has since provided correct credit information to the credit bureaus.
Another Department of Education official told Politico that the head of the Office of Federal Student Aid, Mark Brown, has yet to make a “formal determination” on whether Great Lakes violated department instructions.
Theodore Bunker ✉
Theodore Bunker, a Newsmax writer, has more than a decade covering news, media, and politics.
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