Paying back your student loans is hard enough. It certainly does not help when the trillion-dollar industry seems set up to make you fail.
The Consumer Financial Protection Bureau shed some light on how harrowing this process can be for borrowers on Wednesday when it announced a massive lawsuit against the largest servicer of student loans, Navient, for "systematically and illegally failing borrowers at every stage of repayment."
Reuters spoke with Heather Jarvis, a Wilmington, North Carolina-based attorney who specializes in student loan issues (http://askheatherjarvis.com), about the pain points in the student loan process.
Q: Multiple surveys show that a majority of student loan borrowers do not even know how much they owe. Why is it so hard to find out this basic information?
A: It's because the amount we owe changes every day. To know how much you owe at any given moment, you'd have to look it up and have access to updated records.
It's not even straightforward to know how many loans you have and who processes them. They can be transferred to different services without any choice on your part. It's also not unusual for students to have two to four different student loans each semester they are in school. They all can have different terms and different servicers.
I work with a lot of financial advisors and the overwhelming majority of them are not aware of the details of student loans.
Q: If you have to rely on your loan servicer for information, how can you be sure you are getting the right answer?
A: I tell borrowers to assume they are NOT getting the information they need from their services.
If you call one of these big call centers that the large servicers have, you should assume that the information you're getting is boilerplate language from a script that is for the typical student loan borrower, who is not a real person. The services has a job to do and that's to get the money from you.