College of Arts and Sciences sophomore Chelsea Dellasanta said she chose to come to Boston University for a better chance in the job market after graduating. However, she knew this decision would come with the price of great financial debt.
“It’s ridiculous,” Dellasanta said. “Our parents who work and actually have jobs and have this debt for credit cards. We don’t even have that, and we go into college and have a debt higher than that without a definite job after graduation.”
Dellasanta is one of millions of college students whose concerns are being reviewed by the U.S. Consumer Financial Protection Bureau, according to a press release. The CFBC opened a complaint system Monday for private student loan borrowers to report frustrations with lenders and debt collectors.
The complaint system is open to anyone who has questions or complaints about loans or repayment issues and is seeking information on how to handle student loan debt, said Rohit Chopra, student loan ombudsman at CFPB.
Congress established an ombudsman for private student loans within CFPB following the 2010 Dodd-Frank Wall Street and Consumer Protection Act to model Department of Education’s Federal Student Aid Ombudsman Group that has been active for federal loan borrowers for several years, according to the release.
CFPB plans to form an overall policy agenda using students’ complaints, Chopra said.
“These stories are a great way for us to really understand, which direction we should take on these higher student-lending markets,” he said. “Do we need to create new rules? Do we need to examine banks in different kind of way? Do we need to release new consumer education polls for people to better understand their options?”
Chopra said students will submit a complaint online or over the phone about a certain loan or problem, and the CFPB will first ask the financial institutions or lenders to respond in order to give them the chance to review the complaint.
BU students noted the accumulating college debt, but said they would likely not file complaints.
CAS sophomore Elizabeth Selmi, who works as a peer advisor at BU’s Financial Assistance, said while the idea of the complaint system is good, she doubts it will be effective in helping students.
“It’s a good idea in theory, but the people could just call the loan company,” Selmi said. “It’s not going to drastically change anything. It’ll make students more aware of how screwed they are.”
College of Engineering sophomore Bryan Cosca said he would not need to refer to the CFPB about his loans since he says the lenders are clear about the processes.
“I don’t really have problems or any confusion with my loans,” he said. “They tell you straight up what the interest rate is, and its pretty straight forward on how they do it.”
Cosca said he estimates his student debt will range from $80,000 to $100,00 by the time he graduates from BU. He said he understood the debt he would accumulate coming to BU and chose to enroll regardless for academic reasons.
“I picked BU because the education was worth it, especially the engineering program,” Cosca said. “I know I can land a job that will pay off my debt after I graduate college.”
Selmi, who estimates that she will owe $70,000 by graduation, said she hears her mother say how stressful it is when dealing with her student loans. She said professors, not just students at BU, are also aware of how serious student debt is in the country right now.
“It’s ridiculous,” Selmi said. “I took an economics class, and my professor basically told us how bad it is and showed us how much we would have to earn right out of college to be able to pay it all back.”
Dellasanta said she could not estimate how much debt she will be in when she graduates because of the high interest rates on loans.
“It’ll just take me a very long time to pay them off,” she said.
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