Student-Loan Contractor Seeks to Throw Out Mismanagement Suit
Photographer: Jens Schlueter/Getty Images
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A major U.S. student-loan contractor urged a judge in Boston to throw out a lawsuit accusing the company of mismanaging a federal program that allows forgiveness of loans to borrowers who take government and nonprofit jobs.
Massachusetts in August sued the Pennsylvania Higher Education Assistance Agency, which does business as FedLoan and oversees billions of dollars of loans. The suit alleges FedLoan made mistakes that drove up costs for borrowers in a decade-old federal program that allows students who choose to take lower-paying public-service jobs to erase unpaid debt after 10 years of payments.