Biden Administration Begins Punishing Servicers for Student Loan Errors

More than 830,000 people missed their first student loan payment in three years after one servicer, Missouri Higher Education Loan Authority, commonly known as MOHELA, failed to send timely statements to 2.5 million borrowers. In response, the Biden administration will punish MOHELA by withholding $7.2 million from its contract — the first time it has refused to pay a loan servicer — it announced Monday. The company did not respond to requests for comment.