We have written a number of posts about ongoing operational problems at the Department of Education. We received some encouraging news this week that some of these problems may be fixed, including:
1. We wrote earlier about problems with borrowers seeking to consolidate out of default. The Department was placing borrowers in ICR even if they selected IBR as their preferred payment plan. This has been a huge problem, especially since IBR monthy payments are much lower in most cases.
Department staff tell us that this has been resolved and that borrowers selecting IBR in these circumstances will in fact be placed in IBR if they qualify.
2. The Department has acknowledged a failure to complete the rehabilitation process for Direct Loan borrowers who have made the required reasonable and affordable payments. Many borrowers have been stuck in limbo for months; still required to make payments and still in default.
Department staff claim they have fixed this problem too and are addressing the backlog.