Giving Compass' Take:

• The Trump Administration is pivoting away from Obama-Era regulations that were borrower-friendly to servicer-friendly policies. This shift includes preventing states from imposing their own rule on loan servicers. 

• Should states be able to impose rules on loan servicers? Should the federal government adopt more borrower-friendly policies? 

• Learn about student loan repayment trends in the U.S.

Since 2015, a handful of states have passed, or are at least considering, some version of a bill of rights for student borrowers that stiffen requirements for loan servicers.

States, well aware of the rescission last year of several Obama-era consumer regulations by Education Secretary Betsy DeVos, have been moving to put their own rules in place. Removing regulations, as Devos’s department wants, can harm students, and its latest endeavor to block states’ attempts to police loan servicers has left many wondering: If the department won’t do more to protect students, who will?

Under Obama, the department tried to improve loan servicing from students’ perspective, aiming to make servicers communicate more with borrowers, reform the process of eliminating loan debt for those who are totally and permanently disabled, and create rules for loan servicing that are consistent across the country. When the Trump administration reneged on those aims a year ago, it raised concerns that the department was overlooking borrowers’ interests.

Sure, the Obama-era rules weren’t perfect, Jennifer Wang, of the Institute for College Access and Success, an advocacy group, told me, but there was a lot that borrower advocates liked. However, she says, if the department did not have its own reforms, that shouldn’t prevent states from having them.

Loan servicers, for their part, disagree, insisting that the federal government is right to call states off.

Read the full article about helping student borrowers by Adam Harris at The Atlantic.