The fees – which could be as high as 16% – started creating buzz in mid-March after a policy revision was issued by the U.S. Department of Education. It’s yet another reminder of why borrowers should do all that’s possible to avoid defaulting on student loans.
Ever since , agencies that collect on defaulted debt were forbidden by the Obama administration from tacking on a hefty fee if students began repaying within 60 days of a default. Those who defaulted and rehabilitated after 60 days were still subject to the fee.
But under the Trump administrations’s revised policy, even students who begin repaying loans quickly after a default could be charged the fee. Continue reading »