- Representative Cori Bush has requested information from student loan company MOHELA about its involvement in a lawsuit.
- Six GOP-led states recently argued that Biden’s debt relief would hurt MOHELA’s business operations.
- Bush said the company cannot remain silent on legal issues and asked how it protects borrowers.
President Joe Biden’s student loan forgiveness could be go full steam ahead, but some conservative groups are still trying to stop the relief in its tracks. A Democratic lawmaker has had enough.
On Tuesday, Missouri Rep. Cori Bush sent a letter to Scott Giles, CEO of Missouri-based student loan company MOHELA, requesting information on the extent to which the company is involved in a lawsuit recently filed by a conservative group seeking to end student loan forgiveness. That’s compared to six Republican-led states that are suing the Biden administration because they claims debt relief would hurt their states’ tax revenues, as well as MOHELA business operations.
Bush has already spoken against the company “prioritizing profits over people” by remaining silent during this litigation. Now she wants answers from Giles on how MOHELA is handling aid for millions of borrowers.
“It is unconscionable that your company – as one of the largest student loan companies in the world – is involved in overtly political efforts to deprive millions of people of their right to student debt relief. “, wrote Bush.
“It’s time for your business to support borrowers once and for all,” she added. “To date, your company has remained silent on the legal efforts filed on your behalf to end President Biden’s student debt forgiveness program. The American people, including the millions of borrowers whose livelihoods economics are now at stake, deserve to know where you stand.”
Last week, a federal judge heard the arguments lawyers representing both the Biden administration and Republican-led states, and borrowers are now awaiting a decision on whether debt relief – the application process for which has just officially started – will be interrupted by a preliminary injunction. Bush asked Giles to answer the following questions by October 28:
- How involved are MOHELA leaders in the GOP lawsuit?
- What is the nature of MOHELA’s relationship with the Missouri Attorney General’s Office (one of the plaintiffs in the lawsuit)?
- Does MOHELA support efforts to block debt relief in an effort to preserve its own profits?
- And what steps is the company taking to ensure borrowers don’t lose relief through the Public Service Loan Forgiveness (PSLF) program?
Bush also noted in the letter that borrowers enrolled in the PSLF, which forgives public servants’ student debt after ten years of qualifying payments, recently had their accounts transferred to MOHELA, and they reported wait times of several hours for get help from representatives. This raises concerns because the PSLF derogationset up last year to expand eligible payments to the program, expires on October 31.
“As the sole service for borrowers pursuing the PSLF, these borrowers have no choice but to submit to your firm’s gross malpractice in an effort to obtain relief,” Bush wrote. “I will not sit idly by as your company works on multiple fronts to prevent borrowers from receiving the relief they are entitled to in a clear attempt to continue profiting from the student debt crisis.”
MOHELA has yet to publicly comment on the lawsuits, but Scott Buchanan, executive director of the Student Loan Servicing Alliance — a group that represents federal loan officers — told Insider that saying MOHELA is involved in the lawsuit “doesn’t hurt.” is simply not true” because the company “is not a party to the litigation at all.” He also noted that lending companies could do little about the long wait times for borrowers.
“The department decides how much resources and personnel they’re going to pay to have phones,” Buchanan said. “They choose the type of level of customer service they want us to provide here first, the amount of information they give us, and second the resources they give us. therefore not surprising in the sense that if the department does not provide additional financial resources, it is not possible to provide additional staff. ”