Monday, April 24, 2017

Ari Schwartz, DC Jobs With Justice, 202-674-3228 or

DC Government Must Stop Delays and Step Up to Help Student Loan Borrowers

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As Trump’s Department of Education and loan servicers abandon borrowers, the DC Government must hire its Student Loan Ombudsman to bring much-needed oversight over loan servicers and guidance for District borrowers

WASHINGTON, D.C. – Months after the DC Council unanimously passed legislation to create a Student Loan Ombudsman with authority to license loan servicers, the relevant DC government agency has yet to hire the Ombudsman. At a time when the country’s largest student loan servicer, Navient, declares “there is no expectation that the servicer will act in the interest of the consumer,” the Department of Insurance, Securities, and Banking (DISB) should not be dragging its feet.  Instead of moving forward with hiring this crucial position, DISB has undermined the law and its own ability to find a qualified applicant by requiring the position also serve a secondary, distinct role as Foreclosure Ombudsman.

Elizabeth Falcon, Executive Director of DC Jobs With Justice, issued the following statement:

“More than ever, DC residents desperately need support from District Government to fight our student debt crisis. We are the most indebted jurisdiction in the country, as around 140,000 residents owe an average of $40,885, and 1 in 10 DC borrowers are in default. East of the Anacostia, our neighbors face the brunt of predatory loan servicers and are three times more likely to be behind on their payments.

“In December, we were heartened to see Councilmember David Grosso  and the DC Council unanimously pass the Student Loan Ombudsman Establishment and Servicing Regulation Act of 2016 as a step toward supporting residents and reigning in bad actor debt servicers. When implemented, this law will create an Ombudsman to license and regulate loan servicers and to provide guidance to residents with student loans.

“Months later, however, we are alarmed to see DISB jeopardize the success of this law by requiring the Student Loan Ombudsman to perform a second job as a Foreclosure Ombudsman. By requiring applicants to meet the qualifications of both positions, DISB has undermined its own candidate pool and delayed relief to the tens of thousands of student loan borrowers in DC.

“With Donald Trump and Betsy DeVos abandoning student loan borrowers, now is not the time to cut corners with our support for residents. With the nation’s largest loan servicer Navient facing lawsuits for misleading and defrauding customers, now is not the time for talk without action.

“We call on the Mayor and the DC Council to get a Student Loan Ombudsman hired and working, as the law intended, so that DC can protect and support its student loan borrowers who have been abandoned by the federal government and their servicers.”

Key Resources:

  • Today, Attorney General Karl Racine joined 20 other Attorneys General in a letter to the US Department of Educationopposing its rollback of student loan servicing reforms.
  • The nation’s biggest student loan servicer, Navient, admitted in a court filingit believes “there is no expectation that the servicer will act in the interest of the consumer.”


DC Jobs with Justice is a dynamic coalition of labor organizations, community groups, faith-based organizations, and student groups dedicated to protecting the rights of working people and supporting community struggles to build a more just society.