It has come to the attention of many student loan followers, borrowers, servicers, reporters, and politicians that the Department of Education plans to launch a new customer service feedback system.  The online portal resulted from a survey that revealed some serious shortcomings in the customer service department of the student loan servicer companies employed by the Department of Education.

While some people expect this new addition to improve the student loan experience, a few politicians in Washington D.C. cannot disagree more.

The main objective of the new, user-friendly portal is to centralize the customer feedback through one website; this will supposedly give the Department of Education a direction on improving the customer experience for all borrowers.

While this idea sounds all well and good, it has its critics.  A couple of Republican House Representatives voiced their dissent and distrust for the new system and the Department of Education.  To put this in perspective, Representative John Kilne called this system a “half-baked idea.”

Some readers may think this is just a bunch of Republicans deciding to oppose their governmental counterparts, but there is a little more to it.  Representatives Virginia Foxx and John Kline stated their lack of “confidence in the department’s ability to complete this project” in a letter to Department Secretary, John King.

This lack of trust stems from the congressional history with the Department of Education.  Members of Congress supposedly have been calling for “a common manual for servicers” that addressed the issues causing the creation of the single service solution.  Despite these calls, the Department of Education apparently moved forward with the single servicing solution without providing convincing data that “a project of this magnitude is even feasible.”

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So there are doubts in congress on whether this single servicer portal is going to work, but more importantly, there are serious doubts on whether this system can even be created.  The government does not have much of a track record when it comes to online services, and this would be one of the largest undertakings to date.  With over 40 million borrowers under several different loan servicers, it is not hard to figure out how complex this project may be.

At any rate, there are some serious issues with the overall student loan situation.  Over $1.4 trillion in outstanding student debt is a tough problem to solve.  Will the new service portal solve this problem?  Probably not.

On that note, it does have potential to help improve the situation.  One issue is the number of defaulted and delinquent loans which may be partially attributed to poor loan servicing.  If this is all correct, then a better system would reduce the rate of delinquency and default. These improvements would theoretically apply to both types of loans out on the market, either from the government itself or from third-party lenders, improving performance across the board. With that being said, the portal needs to actually be successful by performing better than the collective effort of the servicing companies.

Clearly, there is quite a bit to be discovered about this new direction the Department of Education is taking.  Time will tell how successful this new system and path forward will be.