Sallie Mae Torments Faithful Student Borrowers After Co-Signers Die

Seven borrowers who had been paying their Sallie Mae student loans on time for years were unexpectedly threatened with asset seizures after a Sallie Mae contractor demanded they immediately repay tens of thousands of dollars simply because a family member had died.

Since an April report by the CFPB highlighted the troubling practice, the financial services industry has spent four weeks on the defensive, arguing that borrowers who face the demands are often delinquent on their debts, or are just out of college and thus unable to shoulder the burden.

What’s more, they argue, borrowers should’ve known they could face auto defaults because it’s detailed in their loan contracts.

Story by Shahien Nasiripour for The Huffington Post.

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