New student-loan repayment glitches are throwing borrowers' budgets into limbo
Student-loan borrowers are reporting significant errors and glitches in their accounts following a major repayment overhaul implemented by the Trump administration. Many users are facing incorrect delinquency notices and difficulty reaching customer service representatives.
Why it matters
Systemic failures in loan servicing platforms can cause severe financial distress and credit damage to millions of borrowers, highlighting issues with government-led administrative transitions.
Getty Images; Alyssa Powell/BI Student-loan borrowers have faced a range of repayment glitches since Trump's overhaul took effect. One borrower thought a past-due notice on her account was a mistake, and then her credit score plunged. Other borrowers said they've received incorrect bills, making it difficult to budget. On August 1, Daniela Perez received three separate emails from her student-loan servicer, MOHELA. The first read "Your payment is due soon." Then "Account is over 210 days delinquent." Finally: "Loan default is approaching." She immediately logged in to her account, which said she had missed 15 payments and had a past-due balance of $10,635. Perez has always stayed current on her payments and never received an alert that she was delinquent. "It was a Saturday, and there was nothing I could do except wait until Monday," the 28-year-old said.
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