I do not think the brand new education loan system are designed very it is earning money for the federal government
At the an effective Senate hearing for the 2014, Sen. Elizabeth Warren, the brand new Massachusetts Democrat, quizzed your face of your Government Pupil Support workplace, James W.
Warren: “My personal question is … where manage men and women winnings go? Would it rating refunded to the young, exactly who paid back over are important for the expense of its funds? Or are they simply familiar with fund regulators fundamentally?”
Runcie, in regards to the government’s loan money
Warren: “The audience is charging more appeal than just we must work with brand new beginner loan system, and there’s zero device to help you refund that money into the students. … ”
While you are old otherwise partially disabled or one another – and have now a great student loans, actually one to the past years – the us government nevertheless can take a portion of the Personal Defense examine
The most egregious samples of which inability concerned light in the February within the a good scathing inspector general’s report on brand new department’s analysis out of charges one Western provider members was overcharged having student education loans by studies agency designers.
An interior department research had downplayed the situation, but the inspector general’s report said the latest department’s remark was statistically flawed, inaccurate and you will incorrect. Sen. Richard Blumenthal, D-Conn., one of several senators that has asked the latest inspector general’s remark, known as department’s internal investigation good “sham research” and you can told you the inspector general’s report shown “a shameful abdication from obligation” from the service to have failing continually to look out for Western service members inside their transactions having education loan servicers. (more…)