The Consumer Financial Protection Bureau began accepting complaints about private student loans Monday, a first step the agency is taking in regulating the private student lending market. The bureau is the sole agency regulating complaints about these loans, and is also preparing a report on the private lending market based on interviews with students, parents, college administrators and others, to be presented to Congress this summer. Before the agency, borrowers with complaints about their loans had to find a bank's regulator in order to lodge a complaint, which was effectively impossible, Rohit Chopra, the bureau's student loan ombudsman, said at a National Association of Student Financial Aid Administrators forum on Monday.
The bureau is also investigating why students borrow the way they do -- including why they don't max out federal loan limits before turning to credit cards, second mortgages and other financial instruments, Chopra said.
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