I was trying to find a witting opening, but all I could come up with for a reference was Mustang Sally. It’s not on target, but some of the lyrics could be made relevant, “All you want to do is ride around Sally, ride, Sally, ride.”
What’s that? Sallie Mae is riding around? Well yes, if we mean taking Federal student loan borrowers for a ride. Sallie Mae is in the news again, this time for lagging in supporting and implementing IBR (Income Based Repayment). The Huffington Post published this article two days ago: Sallie Mae Lags In Student Debt Relief Amid Ongoing Federal Probes.
This is no surprise to me, and probably not to anyone involved in student loan advocacy. The stories I hear from clients and prospects make me laugh in both amazement and incredulity. I had one client told he didn’t make enough for IBR. I had another told that it would be better to use balance based plan, even though the payments were $300 more a month (thus unaffordable). A prospect earlier this week told me the representative didn’t know what IBR was and got into an argument about the existence of the program.
The small good news, according to the article, is that Sallie Mae will receive less accounts to service for the Dept. of Ed. Personally, I’d like to see Sallie’s contract revoked. Not only would it get Sallie out of the Federal System, but it would send such a shock wave through the industry that it might cause a nice shake-up; a sudden desire to comply with the rules. Maybe, just maybe, we’d see real assistance from servicers. But we know better. Sallie will keep its contracts and find an excuse for its performance. Hopefully it will come up with a better excuse than, ““It’s very expensive work, for example, to enroll a borrower into something like an Income-Based Repayment program.” I’m sorry, but Sallie’s current net worth is over a BILLION dollars – and it is concerned about the cost of doing its job! What would Sallie Mae be worth if it suddenly lost a portion of its Federal loan servicing contract?
Read the article and enter my circle of amazement, surprise, anger, and disgust; all at the same time! Student loan work is never boring, that much I can assure you. As long as Sallie Mae is part of the industry, there will always be plenty of work for student loan advocates.
Sallie Mae, you better slow down and stop taking borrowers for a ride.