© 2021 WFAE
90.7 Charlotte 93.7 Southern Pines 90.3 Hickory 106.1 Laurinburg
Play Live Radio
Next Up:
0:00
0:00
Available On Air Stations
United States & World

Top student loan official testifies on troubled loan forgiveness program

SARAH MCCAMMON, HOST:

A quick update now on new changes to the troubled public service loan forgiveness program and what borrowers should know. Richard Cordray heads the Office of Federal Student Aid. He spoke before a House subcommittee today, and he addressed concerns about how those changes have been rolled out. NPR's Cory Turner reports.

CORY TURNER, BYLINE: Earlier this month, the Biden administration announced it is overhauling PSLF. The 2007 program promised federal student loan forgiveness for borrowers who work 10 years in public service. But its poor management left many borrowers in the cold. Today, Cordray said the overhaul is game-changing for hundreds of thousands of borrowers, while acknowledging...

(SOUNDBITE OF ARCHIVED RECORDING)

RICHARD CORDRAY: There's an awful lot of work to do to make that announcement into reality.

TURNER: One challenge - the U.S. government doesn't directly manage student loans. It pays loan servicers to do that. Democratic Congressman Joe Courtney of Connecticut told Cordray he's worried that these servicers aren't prepared for the big changes.

(SOUNDBITE OF ARCHIVED RECORDING)

JOE COURTNEY: We're already hearing from constituents that servicers who are getting calls - because, I mean, this is something people are watching like a hawk, you know, back home - are already being told they're not - they don't have the guidance to implement the PSLF changes.

TURNER: Borrowers shared similar stories with NPR. Several say they called their servicers, believing they now qualify, and asked, what do I need to do? But they were told, we don't know yet. One borrower says her servicer was about as useless as a chocolate teapot. Cordray admitted to lawmakers...

(SOUNDBITE OF ARCHIVED RECORDING)

CORDRAY: We've heard some of the same things you've heard, and we want to get these things sorted out as quickly as possible.

TURNER: Cordray also urged patience, saying it is unrealistic to expect changes this big to happen overnight. But they will happen, he said. Cory Turner, NPR News.

(SOUNDBITE OF MUSIC) Transcript provided by NPR, Copyright NPR.