Senator Elizabeth Warren (D-MA) grilled two student loan servicers and hosted experts at a student loan hearing on Tuesday before sitting down with Yahoo Finance to describe her argument for President Biden to unilaterally cancel $50,000 in federally-backed student loans for tens of millions of Americans.
«Overall, in this hearing, it was perfectly clear [that] we have a broken student loan system,» Warren, chairwoman of the Subcommittee on Economic Policy at the Senate Committee on Banking, Housing, and Urban Affairs, told Yahoo Finance Presents .
«We’ve got these middlemen, these student loan debt servicers that were with us today, who can’t seem to keep straight,» she said, adding that issues with servicers are «just one more example of the United States government is running a massive student loan program that is really putting a burden on tens of millions of people around this country. That makes no sense.»
Warren said that the testimonies and responses provided by two of the student loan servicers who attended the hearing, Navient and the Pennsylvania Higher Education Assistance Agency (PHEAA), solidified her position on the servicers’ roles in creating the crisis.
«The federal government should absolutely fire Navient,» Warren told Jack Remondi, the company’s CEO, during the hearing. «And because this happened under your leadership, Navient should fire you.» She also called on the U.S. government to stop working with PHEAA.
«It just seems pretty straightforward to me on that,» Warren told Yahoo Finance. «These student loan debt servicers, they’re making buckets of money to help their bottom line, but not to help the students who are really in trouble trying to repay their loans.»
In response to Warren’s statements, an ED Spokeswoman Kelly Leon told Yahoo Finance that the agency is mindful of the burden of student loans and realizes that it’s «critically important that we take a thorough look at our entire borrowing and repayment system, including the companies hired to assist us.»
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