CHICAGO (WLS) — Now that President Biden’s student loan forgiveness program has been struck down, nearly 2 million people in Illinois must resume paying back their student loans starting in October. Interest on the loans has already resumed and some burrowers could be faced with even higher payments.
Samer Hassan, who became a U.S. citizen earlier this year, just got his master’s degree in public policy from the University of Chicago.
“I gotta do what I have to do to give back to this country that gave me a chance,” he said.
When we first talked to him back in March, Hassan hoped a portion of his student loans, which exceed $100,000, would be wiped out under Biden’s loan forgiveness plan. But the Supreme Court struck down that plan, and many borrowers like Hassan will resume paying their student loans in October.
Hassan just received a letter in the mail from a new loan service company, Aidvantage, that was subcontracted by the Department of Education. It said his monthly payment increased by 450%.
“They’re telling me the loans went from $127 a month to $700 a month. That is substantial and extortion. It’s like how can I afford this? I’m on my own here,” he said.
Hassan said he’s spent hours on the phone trying to find out why he has a new loan servicer and why this company has dramatically changed his payments.
“So how you navigate this when people are telling you completely different things from organizations that you thought knew what they were doing in the first place,” Hassaan wondered.
He isn’t alone. As many as four in 10 borrowers will be transferred to a different loan service company by fall, according to the Consumer Financial Protection Bureau.
And when the ABC7 Data Team looked at overall complaints about Aidvantage, the CFBP database showed 1,087 complaints about the company since November 2021. Those complaints include “receiving bad information about a loan”, “incorrect account information,” and “problems lowering payments.” The I-Team also found complaints similar to Hassan’s.
We reached out to Aidvantage about Hassan’s loan and the other complaints and haven’t yet heard back.
“This is now extremely scary,” said Hassan.
The Department of Education told the I-Team they are looking into Hassan’s repayment discrepancy. But Hassan still hopes there will still be loan forgiveness in the near future.
And he has reason to. There is a chance a rule making committee within the Department of Education could bring back a version of loan forgiveness. But the Department of Education said it could be more than a year before any decision is made.
In the meantime, one thing you can do to save is to enroll in automatic payments, which can give you a small discount on your interest rate.