Service Members’ Complaints About Student Loans Rise, CFPB Says
Student loans account for a growing number of complaints service members and veterans make about financial products.
While consumers in general began filing more complaints when payments for federally owned student loans restarted in October 2023, service members face some unique challenges, the Consumer Financial Protection Bureau (CFPB) said in a Tuesday (Sept. 24) press release outlining findings from its Office of Servicemember Affairs Annual Report.
For example, service members stationed overseas may have difficulty reaching their student loan servicer during regular call center hours, according to the release. Service members complained to the CFPB that they spend hours trying to reach their student loan servicer and often find that the call fails to resolve the issue.
Another common complaint involves income-driven repayment (IDR) plans, the release said. Because service members often must move every two or three years, their spouses often change jobs and see a drastic change in income. Service members often complain to the CFPB that their loan servicers incorrectly calculate their monthly repayment amounts under IDR plan.
Service members also complain that colleges and universities withhold transcripts when trying to collect a debt or disputed fees, per the release. Service members must frequently move to new duty stations, so they need timely access to transcripts.
“Service members who have worked hard to get an education while serving our country should not face additional obstacles that cause financial strain or put career opportunities at risk,” CFPB Director Rohit Chopra said in the release. “The CFPB is committed to supporting and protecting the financial well-being of service members, veterans and their families.”
Beyond student loans, all major consumer financial products were the subject of more complaints submitted to the CFPB by service members in 2023, according to the release. The number of such complaints was up 27% from 2022 and up 98% from 2021.
The CFPB said in January that it was monitoring the experiences of student borrowers after the resumption of federal student loan repayments.
The regulator found at that time that student borrowers were encountering long hold times when trying to reach student loan servicers, delays in application processing times for IDR plans, and inaccurate billing statements and disclosures.
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