By Tom Stillwagon |Staff Writer|
A growing online petition has student loan giant Sallie Mae re-examining the $50 forbearance fee it charges private borrowers.
On Tuesday, Feb. 7 college student Stef Gray held a press conference on starting a petition against Sallie Mae on a website called change.org. The petition has grown to more than 110,000 names in the last two weeks.
Gray is in opposition to a $50 forbearance fee charged to borrowers, a fee Sallie Mae charges to postpone repayment until the borrower can afford to resume. The monies collected were referred to by Sallie Mae as “good faith deposits” even though none of the money was refundable or being applied to borrower’s accounts.
This fee is only charged to Sallie Mae’s private borrowers. Federal and corporate loans are protected and do not have to pay the fee.
“Basically all I want here is for Sallie Mae to give the same rights and protections to its private loan customers that are guaranteed free of charge to its federal loan customers,” said Gray in the press conference. “Instead, Sallie Mae, in it’s dual role as lender and creditor stand to profit by giving customers no choice but to pay the fee or default.”
Gray, a college student from New York who is currently unemployed, has three separate student loans from three separate schools on file with Sallie Mae. Unable to pay her debt, she was charged the forbearance fee by Sallie Mae on each of her loans.
“Sallie Mae does not offer loan consolidation, so for me, it would be three different loans that I can’t consolidate,” she said. “The fee that they were charging me every three months for forbearance was $150.”
Inspired by Molly Catchpole’s successful petition against Bank of America in 2011, and fed up with the Sallie Mae forbearance fee, Gray opened an account at change.org and drafted the petition.
William Winters, senior organizer for Economic Justice at change.org, has been working directly with Gray.
“Campaigns like Gray’s definitely demonstrate the power of our platform,” said Winters.
Change.org is a website where individuals can start a campaign to promote issues that are important in their lives. The website offers free tools to its users, including the petition maker Gray used, and templates to model a petition.
“Her campaign couldn’t be more timely right now. There are more conversations about the affordability of college and the increasing debt that students are graduating with in order to get an education that looks like it is gliding toward a lower return on the type of quality jobs that are available,” said Winters.
Gray says she feels that Sallie Mae fails to provide safety nets for students with loans. She hopes that the petition will prompt the company to re-examine the fees and hopefully remove them.
She encourages any students in need of loans to avoid Sallie Mae and look elsewhere.
Since the petition started to go viral, Sallie Mae has agreed to apply the $50 fee towards loan repayment. Graf does not feel this is sufficient and plans to continue promoting the petition until Sallie Mae drops the fee altogether.
“I want to give Sallie Mae every penny that I owe them,” said Gray, “but they are making it unfairly difficult right now.”