Senator Elizabeth Warren warns of financial consequences for borrowers as federal student loan collections resume.

From Yahoo Finance: 2025-06-12 23:50:00

Sen. Elizabeth Warren warned of a financial scarlet letter for millions of borrowers as collections on defaulted federal student loans resume after a five-year pause. The New York Federal Reserve reports an 8.04% delinquency rate on education-loan balances, with 2.2 million borrowers experiencing credit score drops. Warren highlights the long-term consequences of damaged credit, such as higher interest rates on car loans and difficulty securing mortgages. Education Secretary Linda McMahon defends the crackdown, emphasizing the need for accountability. Warren criticizes a House spending bill that could impact income-driven repayment plans, potentially raising monthly bills.



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