NJ now has advocate who’ll fight for student loan borrowers
The Department of Banking and Insurance has designated an advocate to help student loan borrowers resolve disputes with student loan servicers.
Commissioner Marlene Caride said Raghu Kakumanu, the assistant division director of banking, has been designated as the new student loan ombudsman.
People who have student loans can reach out to the office and speak with advocates who can assist with questions about loans and help file complaints against a loan service company.
"The total student loan debt right now is around $1.7 trillion nationwide and the average New Jersey borrower carries roughly about $36,000 in student debt," Caride said.
Student loan service were not regulated in New Jersey until a new law that allows the Department of Banking and Insurance to regulate them. A licensing process was put into place in September, meaning these companies now will have to be licensed through the department.
The law also protects student loan borrowers against deceptive practices by student loan servicers.
Caride said under the law, if a borrower finds out he or she is being serviced by a company that is not licensed, they can call the department and let the ombudsman or another advocate handle the situation.
If the borrower feels their concerns or issues are not being properly addressed by the servicing company, they can reach out to the department to have someone advocate on their behalf.
The hotline number to call is 1-800-446-7467.
Borrowers can also go to the department website and complete the banking formal complaint form.
Besides student loan disputes, the department also is working with the state Department of Higher Education Student Assistance Authority to receive additional resources to educate the borrower about students loans.
"Our job is to help them have a better understanding of what is a student loan and what are the consequences of the student loan, how can this affect them, and again, making sure that they are treated fairly," said Caride.