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wait so lemme get this straight, the govt shut down your lender for being predatory...but still makes u pay the predatory loan????? wtf kind of system is this??????
It's actually more nuanced than that. When the Department of Education terminates a servicer's contract, they're not necessarily declaring all loans they serviced as predatory. They're often citing contract violations, poor customer service, or mismanagement. The loans themselves are still valid federal obligations, but they get transferred to a different servicer who hopefully will manage them properly. That said, there are specific cases where loan discharge might be available - like the Borrower Defense to Repayment program if your school misled you, or servicer-specific settlement programs like we've seen with Navient.
UPDATE: Thanks everyone for your helpful responses! I've learned so much. I was able to confirm this is indeed a Parent PLUS loan at 7.9% interest that my mom took out for me, which explains the high interest rate. I've applied for an Income-Contingent Repayment plan and am also looking into consolidation options. I was also able to get through to someone at FSA (thanks for the Claimyr tip, it actually worked!) and they explained that several periods of deferment had caused interest capitalization, which is why the interest growth seems so extreme. They're sending me information about the specific borrower protections available in my situation. I feel much better now that I understand what's going on, even though the situation still isn't great. I'll update again once I hear back about the ICR application!
Does anyone know if its possible to change which parent fills out the form after youve already started? My daughter put her dad but really i should be doing it....
Just wanted to update - we carefully reviewed who provided more financial support last year and determined it was me (slightly more than 50%). After answering the questions accurately, the system correctly asked for my information. My ex-husband won't need to provide his information even though we're in the same household. Strange new system but at least it's working as designed. Thanks everyone for the helpful explanations!
this happened to my cousin and he ended up having to wait until he was 24 to go to college because the school wouldnt approve his override. so unfair
I'm so sorry that happened to your cousin. While some schools are unfortunately rigid, most institutions today are much better about approving these overrides when properly documented. The key is providing thorough documentation and following up persistently. If one school denies it, I always recommend trying another institution, as policies can vary significantly.
my nephew got approved at one school but denied at another for the EXACT same situation last year. makes no sense. the fafsa system is broken
Update: You all were right! I was looking for 2023 tax info when I should have been requesting my 2022 transcript for the 2024-2025 FAFSA. I just successfully got my transcript online! I also talked to my financial aid office and they're giving me a 1-week extension on the verification documents. THANK YOU all for your help!
This whole system is DESIGNED to make students miss deadlines and lose aid. My sister lost her entire grant package last year because of verification delays. The financial aid system claims to help low-income students but then creates impossible bureaucratic hurdles. Did you know colleges actually MAKE MONEY when students don't complete verification? They get to keep the federal aid money that would have gone to students. The whole thing is corrupt.
While verification can certainly be frustrating, colleges don't actually profit from students not completing verification. Unclaimed federal aid returns to the Department of Education, not to the schools. The verification process exists to ensure program integrity, though I agree the implementation can create unnecessary barriers for students. The good news is that the simplified FAFSA rolling out fully for 2025-2026 should significantly reduce verification requirements for many students.
Keisha Jackson
The entire financial aid system is DESIGNED to be confusing and inefficient! They create these arbitrary deadlines and then drag their feet processing everything. It's absolutely RIDICULOUS that parents have to jump through so many hoops just to pay for their kid's education with LOANS WE HAVE TO PAY BACK WITH INTEREST!!! The Parent PLUS loan is especially predatory since there's basically no borrowing limit and the interest rates are higher than student loans. UNC system knows this and takes their sweet time processing these loans because they know parents are desperate. My advice? Call them DAILY until it's processed. Be the squeaky wheel.
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StarSurfer
•I agree the system is frustrating, but I'm trying to focus on getting through this process right now. Calling daily might actually be good advice though - I'll try to check in with them regularly.
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Ava Martinez
Just to follow up on my earlier comment - make sure you've completed both the Parent PLUS application AND the Master Promissory Note (MPN). Many parents don't realize these are two separate steps. You also need to complete entrance counseling if this is your first Parent PLUS loan. Also, if UNC-G's timeline doesn't work for you, remember you have other options: 1. Most schools will place a temporary credit on the student's account if they can see the Parent PLUS loan is in process 2. You can request a payment plan to break up the balance 3. Private education loans are another option (though usually at higher interest rates) Hope this helps ease some stress!
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StarSurfer
•Thank you - this is all really helpful! I'm going to call tomorrow to check on the status and make sure I've completed all the required steps. I'll also ask about the temporary credit option just in case the processing takes longer than expected. Really appreciate everyone's advice here!
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