The Education Department has cleared the companies that manage its student-loan payments of wrongdoing in a yearlong investigation into their treatment of military borrowers.
The inquiry, which focused on the government’s four major servicers — Navient; Great Lakes; the Pennsylvania Higher Education Assistance Agency, or Pheaa; and the National Education Loan Network, or Nelnet — found that the companies generally complied with a law that requires them to award interest-rate reductions to active-duty service members, incorrectly withholding the benefit in less than 1 percent of cases. (A separate investigation into the department’s seven nonprofit servicers and companies that service bank-based loans continues, with results due later this year.)
The department’s findings stand in stark contrast to the results of a 2014 audit by the Department of Justice, which found that one of the servicers had unfairly denied the benefit to 93 percent of applicants. The discrepancy appears to be a result of different standards applied by the agencies.
Read more at The Chronicle of Higher Education: https://chronicle.com/article/Education-Dept-Finds-Little/230403
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