We all have heard the numbers about escalating student loan debt across the country. Maine is no exception. Residents of our state carry more than $6 billion in education debt.
Excessive student debt takes money out of Maine’s economy. MECEP’s analysis indicates that education debt held by Mainers could support 6,000 jobs and three-quarters of a billion dollars in consumer spending if it were circulating through Maine’s economy instead of being sent to federal lenders and loan servicers.
Research by MECEP shows the $6 billion in student debt also keeps Mainers from buying homes and saving for retirement. Some borrowers are even unable to pay their bills or afford basics such as food and clothing or medical care. These are just some of the ways Mainers struggle mightily under their student loan debt.
There are many reasons student borrowers may have trouble paying down their loans. But one reason is beyond the control of individual borrowers: the egregious business practices deployed for profit by the finance companies that service student loans.
Today, the world of student loan servicing is like the Wild West. There are few rules, and little enforcement, to prevent giant student loan corporations from preying on their customers.