By Peter Schroeder - 02/21/13 08:01 PM EST
Education Secretary Arne DuncanArne DuncanProposed Department of Education rule runs counter to ESSA's restrictions In search of the surest Common Core exit route The opt-out movement and the coddling epidemic MORE backed the CFPB's efforts Thursday.
"Federal student loans remain the best option for borrowers, but we know some students have turned to private student loans and are struggling to repay," he said. "We're glad to see the CFPB is taking steps to help create options for those who are having trouble managing their private student loan debt."
Specifically, the CFPB is seeking input on how student loan burdens could hinder the broader economy, as borrowers buried by student loan debt might struggle to line up other loans for things like homes and cars. It also wants to know how struggling borrowers cope with their obligations, and what options exist for them to lower their monthly payments, including any examples of successful alternate payment programs found in other markets.
In October, the CFPB's student loan ombudsman released a report that found a range of problems facing private student loan borrowers. For example, many borrowers told the bureau that they struggled to find out how much they owed after graduating, while others struggled to actually contact their loan servicer and lacked options to affordably refinance their debt.