As if paying back student loans isn’t hard enough, Education Secretary Betsy DeVos just found a way to make it harder. On Wedneday, she rolled back two Obama-era policies intended to make consumer protection for borrowers stronger, according to Bloomberg News.
The policies, instituted last year, requiring that the Federal Student Aid Office put more effort into helping the borrowers manage their debt by evaluating its servicing contracts making it easier for them to deal with what can often be large amounts to pay back for going to college.
But DeVos, who is part of President Trump’s hit squad determined to bat 1000 this week, she decided to fix what wasn’t broken and do away with those policies. “We now find ourselves in a situation where we must promptly address not only these shortcomings but also any other issues that may impede our ability to ensure borrowers do not experience deficiencies in service,” DeVos wrote in a memorandum to James W. Runcie, Federal Student Aid Chief Operating Officer, telling him she was withdrawing three memos sent by the Obama administration ordering the improved servicing of the loans.
But what she did was withdraw requirements that routing records audits be put in place, as well as a compliance review process, reviews of timeliness of payment processing along with other items that would help borrowers with their loan servicing plans, thus moving things back to being as confusing as they were before Obama instituted the policies.
However, without those safeguards in place it could actually be more dangerous for student loan borrowers. “DeVos’ actions today moves us away from true accountability, and creates dangers for the very student loan borrowers the department is responsible for protecting,” Alexis Goldstein, senior policy analyst at the progressive Americans for Financial Reform, told the Chicago Tribune.