"Biden Administration Sanctions Loan Servicers Amid Repayment Mishaps and Risks to Borrowers"
Originally Published 2 years ago — by The Associated Press
The Biden administration is penalizing student loan servicers Aidvantage, EdFinancial, and Nelnet by withholding over $2 million in payments due to their failure to send timely billing statements to borrowers after the end of the pandemic payment freeze. This action follows a previous $7.2 million withholding from MOHELA for similar issues. The servicers' errors affected over 750,000 borrowers, who will now be placed in administrative forbearance to resolve the issues without penalties. The Education Department is also working on a new student loan cancellation proposal after the Supreme Court rejected the initial plan.