The U.S. Consumer Financial Protection Bureau is seeking public input on possible policies to ease repayment of student loans, the agency said in an e-mailed statement.
“Too many private student-loan borrowers are struggling with unwieldy debt that prevents them from climbing the economic ladder,” said Richard Cordray, the CFPB’s director, said in an e-mail. “We will be analyzing plans for policy makers to consider that might help avoid a repeat of the mortgage meltdown for today’s student-loan borrowers.”
The CFPB is asking for input on how student loans might affect the broader economy and impede access to other forms of credit. It also wants to collect more information on how struggling borrowers manage their loan repayments, options for lowering monthly payments and examples of repayment plans in other markets that might work for student loans.
In a July report to Congress, the CFPB and Education Department said that “too many student loan borrowers are struggling to pay off private student loans that they did not understand and cannot afford.” Aggregate private student-loan debt amounted to about $150 billion at the time, representing 15 percent of total education debt, the report said.
About 30 lenders issue private loans. Among the largest are SLM Corp., better known as Sallie Mae; Wells Fargo & Co.; and Discover Financial Services, according to the Washington-based Consumer Bankers Association.
Public comments are due by April 8.