President Barack Obama wants students who take out loans to pay for college to receive better customer service. A presidential memorandum that Obama dubbed a Student Aid Bill of Rights in March 2015 would provide that, advocates say.
The memo orders Department of Education to create a database where borrowers could report problems that they have with lenders, loan servicers, collection agencies and even colleges and a portal where borrowers could have one place to view information about all of their federal loans. The memo also calls for Department of Education to strengthen consumer protections throughout the repayment process.
“It’s a good start, but it’s more of a road map,” says Deanne Loonin, who is the director of National Consumer Law Center’s Student Loan Borrower Assistance Project. “There’s not a lot of detail to it.” For instance, Loonin says, the memo requires improved collection standards in regard to student-load debt but doesn’t specify what the new standards should be.
The deadlines for the actions, such as completing the online-complaint system by July 2016, are doable, experts say.
“Now the question is how long it’s going to take the Department of Education to comply and what the details are as they go through each of these proposals,” Loonin says.