Education Department introduces new online portal for student loan borrowers
The U.S. Department of Education has launched a new support resource for student loan borrowers in default as additional changes to the federal student loan system continue to take effect.
Experts estimated that the current outstanding balance of the total federal student loan portfolio exceeds $1.5 trillion, according to a news article from Newsweek. In collaboration with the U.S. Department of the Treasury, the Education Department’s Defaulted Loans Support Center will aim to streamline the process of returning the more than 9 million borrowers in default to good standing. Borrowers who access the digital portal can submit payments, track the status of their loans, compare repayment options, receive guidance in navigating the repayment system and apply for loan rehabilitation or consolidation.
The experts noted that borrowers in good standing — including those making repayments for Direct Subsidized, Direct Unsubsidized, Direct PLUS and Direct Consolidation Loans issued after June 30, 2012 — will now have until the end of the year to apply for an auto pay interest rate discount of 1% that would reduce lifetime repayment costs. The rate reduction would last until June 30, 2028. While the benefit may be small, the experts urged qualified borrowers to join nearly 2 million of their peers in taking advantage of the discount, which can add up in savings over time.
Read more: Newsweek
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