If you cruised through the pandemic without making a payment on your student loans, you're extremely lucky. Though school loans were legally in forbearance during the pandemic, no one was working to stop the servicer or the U.S. Department of Education from directly debiting your bank account throughout the forbearance period. If your loan servicer took your money and no longer exists, your best bet is probably a consumer protection complaint through your state's attorney general's office.
 

President Biden Helps Student Loan Recipients Discharge Debts

President Biden effectively helped 675 thousand graduates discharge $15 billion of debt with the U.S. Department of Education. Public Service Loan Forgiveness (PSLF) programs, permanent disability discharges, and closed schools' debt cancellation programs helped 675 thousand borrowers under the Biden administration.
 

Multi-Billion Dollar Settlement with Navient Student Loan Servicer

Navient Corporation in a negotiated settlement with the attorney generals of 39 states agrees to cancel $1.7 billion in predatory subprime student loans for borrowers throughout the United States. Additionally, Navient will pay $95 million in restitution to borrowers whose loans continued to accrue interest while in forbearance. Maryland's Attorney General Frosh announced that 1,100 Marylanders will have $34 million dollars of debt cancelled, and 350,000 federal loan borrowers residing in Maryland will be compensated with $3,155,124 in restitution. Navient forced borrowers who could not pay to accept forbearance, which was either a short-term solution or a predatory attempt to force the borrowers deeper in debt. Navient should have negotiated repayment plans to benefit their borrowers.
 

Student Loan Defense Center, LLC. Pays for Robocalls

A class action lawsuit was filed during September 2021 in the United States District Court of Maryland against the Student Loan Defense Center, LLC. of Wyoming for repeated disregard for the Telephone Consumer Protection Act, 47 U.S.C. - 227. The Student Loan Defense Center, LLC. ruthlessly pursued those who defaulted on federal student loans until attorneys for the defendants demanded $500 for each unsolicited phone call, $1500 for each willful violation of the TCPA, $500 for each violation of the Do Not Call Registry, and a permanent injunction to stop the defendants form making the unsolicited phone calls.
 

The U.S. Department of Education Capitalized on Loan Consolidations

The U.S. Department of Education reportedly failed to process borrowers' repayment plans carefully drafted by well-intentioned student loan servicers unduly burdening the borrowers. The Department of Education capitalized on its relationships to for-profit colleges and benefited from interest accrued on defaulted student loans. Consolidated student loans are a burden on the borrower who attempts to benefit from his or her newly acquired education. Consolidated student loans debt exceeds $72 billion in the United States. Practices of the U.S. Department of Education cost borrowers millions of dollars.
 

Pennsylvania Higher Education Assistance Agency Collected Unreasonable Fees

A class action lawsuit was filed in the U.S. District Court for the Eastern District of Pennsylvania against the Pennsylvania Higher Education Assistance Agency (PHEAA) for deliberately increasing the duration of borrowers' loans to collect additional fees from borrowers who were powerless against large sums of money transferred in their names. PHEAA delayed processing payments through the Public Service Loan Forgiveness Program (PSLF), the Teacher Education Assistance for College and Higher Education (TEACH) program, and the Income Driven Repayment (IDR) plans. The delays made it impossible for borrowers to make consecutive payments and have their loans forgiven under the terms of their loan forgiveness plans.
 

NorthStar Unlawfully Breached Student Loan Contracts

NorthStar Education, trading as Total Higher Education, failed to honor their contractual promise of lower interest rates for borrowers who always made their payments on time or early. A class action lawsuit filed in the U.S. District Court of the Eastern District of New York against NorthStar demanded compensation for its violations of the Fair Debt Collection Practices Act. Additionally, when debts over $600.00 are forgiven or settled for less than the balance owed, the amount is reported to the Internal Revenue Service on a Form 1099C. The forgiven, or reduced, amount is taxable income. Borrowers were denied their options to claim that student loans forgiven are not taxable income.
 

Attorney Generals Resolve Student Loan Repayment Issues

If you have similar problems with your student loan servicer or the U.S. Department of Education, your state's attorney general can mediate a solution for you. If your payments or your garnished wages are evaporating with no decrease in your loan balance, the servicer or garnishing agency is claiming your payments to pay for its fees with interest.