A petition asking Sallie Mae to revoke the $50 quarterly "forbearance fee" that the lender imposes on borrowers who are unable to repay their student loans has gathered more than 75,000 signatures. Forbearance, when loans continue to accumulate capitalized interest although borrowers do not have to make payments, is the last resort to avoid default, and the petition protests the $50 fee as an "unemployment tax."
"As an unemployed person desperately looking for work, I need every extra dollar I have to pay for rent, electricity and groceries," wrote Stef Gray on the petition. "But Sallie Mae is preying on people like me and cashing in on the fact that we need more time to find work before we can repay our student loans."
Such fees are not uncommon on private loans, and Sallie Mae has defended them as a way to ensure that the borrower is committed to continuing to pay.
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- 'The Student Loan Scam'
- Sallie Mae, Navient settle U.S. charges of overcharging servicemembers, misrepresenting late fees
- Consumer Financial Protection Bureau publishes 2,000 comments on private student loans
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