CONTACT:
Ori Korin 202-393-1044 x126 or ori@jwj.org
Washington, D.C. — Following years of pressure from borrowers, legislators and activists and growing outrage over mishandling of information, the U.S. Department of Education announced late yesterday that it would be terminating its debt collection contracts with five private collection agencies, including Pioneer Credit Recovery, owned by former Sallie Mae subsidiary Navient. Jobs With Justice’s Debt-Free Future organizer Chris Hicks called the decision a huge victory for the campaign, and for struggling borrowers:
“We are relieved to hear that the Department of Education has taken the first step to protect borrowers struggling to pay off their debt, and toward holding their contractors accountable. Pioneer, which is owned by giant student loan servicer Navient, is being paid millions of dollars by the Department to collect on student debt, yet borrowers are facing inaccurate records, misleading information and terrible customer service. Finally, the government is looking out for taxpayers’ interests, not Navient’s.
We hope this level of oversight will soon be extended to student loan servicing contractors as well. With record-high default rates and a growing number of borrowers not being informed about available flexible repayment options, it’s high time someone reign in these companies getting rich on the backs of people trying to achieve an education.”
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