A tentative budget deal struck on Monday by the White House and Congressional
leaders will result in some irritating consequences for Americans with
student loan debt.
The new provision would give debt collectors permission to robocall and
auto-text the cell phones of borrowers. While consumers with cellular
phones who have not given permission for companies to contact them on
their mobile devices are typically protected under the Telephone Consumer
Protection Act, auto-dialed calls would be completely legal to place to
borrowers who have not given their consent to do so.
Why is this a problem? Not only will borrowers have to deal with having
their phones bombarded with unwanted text messages and calls, but they
will also be charged for them. Unlike a landline, many cell phone users
pay for a certain amount of minutes and text messages each month, and
would now have to face acceptance of charges for creditor harassment.
For low-income individuals relying on prepaid cell plans, this is a serious concern.
President Obama has pushed for this new legislation, arguing that it will
lead to higher recoveries on delinquent student loan debt. The student
loan industry, naturally, is also enthusiastic about these changes. In
addition, the Education Department is expected to boost their profits
by being able to employ less workers to hand-dial borrowers’ cell phones.
So far, there is very little evidence that this move will do anything to
avert loan defaults or increase collections. If this pact is enacted into
law, the Federal Communications Commission (FCC) will be required to write
new rules within nine months.
Chicago Consumer Attorneys Fighting for Your Rights
Over 40 million Americans have federal student loans, and nearly 7 million
are currently in default. Since nearly half of Americans rely solely on
cell phones, this new legislation is expected to affect a large number
of people. If you are struggling with student loan debt and are being
harassed by collectors, please consult with a
Chicago consumer lawyer at Sulaiman Law Group, LTD. We are prepared to advise you on the best
course of action during a consultation.
Request your consultation with a member of our award-winning firm by calling
us at (312) 313-1613.