Loan Providers Fail to Relieve Student Debt for Nonprofit Workers

Feb 20, 2019, 1:50 PM

(from Nonprofit Quarterly) Some independent schools are encountering requests from faculty to pay back student loans as an employee benefit. Graduates with loans may not be getting the loan forgiveness they were promised. Student loans should be forgiven if the graduate works in the nonprofit sector for 10 years. Last year, an audit revealed that those participating in the student loan forgiveness program for those employed by nonprofits, among other specified jobs, were not being rewarded with the promised debt cancellation after ten years. Now, the latest audit from the Office of the Inspector General of the U.S. Department of Education has exposed failures to follow federal rules by the loan servicers who manage the student loans and collect the payments. Errors were also discovered in the calculations for income-driven payment plans.