Tuesday night, President Barack Obama used his fifth State of the Union speech to outline the “year of action” he wants to take in public policy, with or without the help of Congress. One of the key issues he addressed was student loan debt. According to the administration, there are 37 million student loan borrowers nationwide. Also, since the administration has worked with creditors to reform student loans, by getting the Department of Education more directly involved in lending and reforming payment structures, more people are going to college than ever before. The Obama administration says it wants to keep this positive trend going by enhancing the “pay as you earn” program for student loan debt.
Yet in a speech so focused on American economic development (The President used the words “economy” and “economic” 18 times), one of the biggest changes to the financial landscape since the President took office was conspicuously absent. Despite the fact that the relatively new Consumer Financial Protection Bureau only had its first chairman, Richard Cordray, confirmed in July 2013, President Obama never mentioned the CFPB in his address (He never even used the word “consumer”!). This is a noticeable change from an executive branch that has made a point of letting consumers know about how the CFPB is trying to seemingly level the playing field.
For example, most CFPB publications and news releases make note of the new consumer complaints database and the opportunity on their website to file complaints. Because of this push, the debt collection industry alone has seen more than 10,000 complaints filed against it since the database launched in summer 2013. Learn more about how the CFPB plans to use consumer complaint data for future reform of the debt collection industry in To the Point: CFPB Collection Complaints. We also have two CFPB webinars coming up in February and March to get your agency ready for new enforcement actions and potential new rules. Get step-by-step guidance on how to survive a CFPB audit, with your sanity and bottom line intact. Learn from top compliance experts what debt collection agencies can do right now to get ready for more CFPB oversight.
What do you think the President’s comments and plans regarding student loan debt mean for creditors and collectors? What other points do you wish he had made in his State of the Union? Let us know in the comments.