Draft Rules Would Ease Student-Loan Burdens for Some

Chronicle of Higher Education

In a package of proposed rules circulated among a team of negotiators this week, the department is seeking to make it easier for certain disabled borrowers and public servants to have their debts forgiven.

Student loan debt: The next financial disaster?

CBS Money Watch

Student loan debt is pushing a growing number of Americans into bankruptcy and an organization of bankruptcy lawyers predicted this week that the college debt problem could become as big a catastrophe as the home mortgage crisis.

S&P Warns Student Loans May Be The Next Bubble To Burst In US Economy

Huffington Post

Student Loan Debt Woes Fuel Bankruptcy

Investor's Business Daily

A new survey by the National Association of Consumer Bankruptcy Attorneys found that 81% of bankruptcy attorneys say that potential clients with student-loan debt have increased either "significantly" or "somewhat" in the last three to four years. The sharp recession and historically sluggish economic and jobs recovery have taken their toll. But the numbers are another sign that major troubles may lie ahead for higher education. Critics contend that we are in the middle of a "higher education bubble," meaning that increasingly the value of a college degree does not match the rising cost.

Online Campaign Prompts Sallie Mae to Change Fee Policy for Loan Suspensions

New York Times

On Thursday, three months after Bank of America backed down from imposing a $5 monthly debit card fee in response to an online petition, Sallie Mae changed its fee policy in response to an online petition. For years, Sallie Mae had required unemployed people who could not afford their monthly payments to pay a $50-per-loan fee every three months to suspend their payments temporarily, even as interest charges mounted. Sallie Mae called this forbearance fee a "good faith deposit" - but it was neither credited to the borrower's account nor refunded.

Unemployed Criticize Sallie Mae 'Forbearance Fee'

Inside Higher Ed

A petition asking Sallie Mae to revoke the $50 quarterly "forbearance fee" that the lender imposes on borrowers who are unable to repay their student loans has gathered more than 75,000 signatures. Forbearance, when loans continue to accumulate capitalized interest although borrowers do not have to make payments, is the last resort to avoid default, and the petition protests the $50 fee as an "unemployment tax."

US Senate wants insight into Davidson’s ‘no loan debt’ program

WSOC-TV, Charlotte, N.C.

People across the country are trying to learn from Davidson College, where students can attend four years of classes without ever taking out a loan. College President Carol Quillen spent a day in Washington showing lawmakers how Davidson manages the program. The college made news in recent years with its Davidson Trust program. The program does away with student loans and replaces them with more financial aid and grants, which means less debt for needy students.

Borrowers to Be Contacted on Loan Consolidation

NAICU Washington Update

January 17 certain Federal Student Loan servicers began contacting borrowers eligible to consolidate their loans under a Special Direct Consolidation Loan program. This new, short-term opportunity is part of President Obama's initiative to reduce borrowers' cost of repaying student loans. The program is available to borrowers who meet certain conditions, and they must apply by June 30.

Student Loan Negotiated Rule-making: The Progress to Date

NAICU Washington Update

The first of three Department of Education sessions to develop student loan regulations was largely devoted to technical issues. Still the early-January sessions did address the Department's intent to make regulatory changes to the income-contingent repayment (ICR) and the income-based repayment (IBR) plans.  Additional meetings are scheduled for February and March.

7 ways to tackle the nation's student debt crisis

CBSNews.com

Leading financial aid expert Mark Kantrowitz, the publisher of Finaid, recently posted a paper on the website of the National Association of Student Financial Aid Administrators that outlines ways to help reduce student debt. Here are seven of Kantrowitz's suggestions, including perhaps the most controversial -- allowing graduates to once again be able to discharge student debt in bankruptcy court.