Sallie Mae to start applying unemployment forbearance fees to loans after online protest

An online protest has ended in victory for unemployed Sallie Mae private student loan customers forced to pay what some are calling a predatory forbearance fee, The New York Times reports.

For years, Sallie Mae, the largest private student loan lender in the U.S., had been collecting up to $150 in “good faith deposits” from unemployed borrowers quarterly to keep loan payments temporarily suspended, but that money was never credited to the loan or paid back, it just vanished.  

But the private lender is changing its policy after a Change.org petition against the policy collected 300,000.

The Change.org petition was started by unemployed college graduate Stef Gray. She took out a $40,000 loan that ballooned to $65,000 with interest and was frustrated with her quarterly Sallie Mae fee disappearing into a black hole.

She delivered 77,000 signatures to Sallie Mae's Washington, D.C. and asked that they change their fee policy.

Sallie Mae has agreed to start crediting the fee toward the student loan, just three months after a similar Change.org protest got Bank of America to drop its $5 monthly debit card fee.

But Gray says the company needs to do more.

“It’s a partial victory,” she said. “They’re still charging a forbearance fee, which they don’t for federal loans. I’m glad they’re not pocketing the fee, but they’re still charging it. And I still can’t pay it.”

Read New York Times article here: http://nyti.ms/xtHibB