Student Loans and Hurricane Katrina

[LynnInMN]

I cannot find anything official yet, but the Department of Ed usually issues a bulletin shortly after any natural disaster. They issue administrative forebearances for current loans and freeze the due diligence clocks for those in default for borrowers living in affected counties. I dealt with this after Hurricane Andrew and California Earthquakes. I realize that paying student loans are not a priority on peoples minds right now, but if you have family or friends in these areas that are displaced or have economic loss due to this disaster, let them know at some point in the near future to contact their lenders. This bulletin usually comes out about 2 weeks after the disaster. I emailed my friend at Southwest Student Services and she will send me a copy of the bulletin when it comes in.

[TxQuiltGirl]

Thank you for providing this information, Lynn. I'm sure it will be helpful to some of those who are in the affected area.

[flcleo]

This information needs to be broadcast to the media so the word can get out. If they can show the looting and the trashed homes over and over again they can broadcast the less exiciting things. So far I've seen that a lot of the auto makers are giving extensions on car payments, etc.

 

My area was affected by two hurricanes last year, power outages, businesses shut down, etc. Until you go through this experience you can't describe it. Leading up to the hurricane and after you spend money...afterwards, you can't cook, all your food spoils, there's a mad rush for gas. My area lost 28,000 jobs.

 

I entered into rehab for my loans not too long afterwards. The CA never mentioned anything about this to me and I never heard anything about it. I was never sent anything either. I did hear about the IRS giving extensions for filing.

 

I'm going to contact AES and see what's up. If I'm entitled to extra forbearance or anything extra, I'm asking for it.

[LynnInMN]

The following is an example of a bulletin put out by ASA for hurricane charley.

 

 

 

American Student Assistance

 

e.clips Story

 

 

 

Hurricane Charley Compliance Alert

 

--------------------------------------------------------------------------------

Brendan Furey

Regulatory Analyst Partnerships

 

--------------------------------------------------------------------------------

Lenders, servicers and guarantors dealing with student loan borrowers in Florida should be aware of the following regulatory relief as a result of Hurricane Charley:

Disbursements to schools:

• Lenders, guarantors and other disbursing agents are authorized not to disburse loan proceeds to schools in areas declared Federal Disaster areas if they are informed the school has a delayed opening or has ceased operations for an undetermined period of time.

• A notation should be made in the school’s profile.

 

Borrowers currently in school:

• Borrowers are kept in “in-school” status regardless of their attendance until such time as the borrower withdraws or re-enrolls during the next regular enrollment period. If a regular enrollment period’s begin date passes and the borrower does not enroll, then the borrower is put into repayment (which begins with a grace period if still available for the borrower) as of the date of the next enrollment period.

• If an institution’s normal operations are interrupted while a borrower is in an “in-school” deferment status, then the borrower stays in an “in-school” deferment status until the borrower withdraws or re-enrolls in the school.

 

Borrowers in repayment:

• Florida student loan borrowers affected by Hurricane Charley may be eligible for administrative forbearance for up to three months. All borrowers must call to request relief due to Hurricane Charley

• Defaulted borrowers who have been adversely affected by Hurricane Charley may, upon request, have their loans put in administrative forbearance for up to three months without being required to submit supporting documentation or sign a written agreement.

• Administrative forbearances applied to defaulted borrowers accounts should not affect their rehabilitation eligibility.

• Borrowers not in default are also eligible for the above referenced administrative forbearance. If these borrowers should contact ASA rather than their loan holder, they will be assisted in their request for relief by facilitating their contact to their loan holder.

• Lenders may use additional administrative forbearance to resolve any delinquencies that existed on the borrower’s account prior to the disaster forbearance.

 

Generally, borrowers (who live and/or work in) and institutions in the following counties should qualify: Brevard, Charlotte, Collier, DeSoto, Dixie, Duval, Glades, Hardee, Hendry, Highlands, Indian River, Lake, Lee, Levy, Manatee, Monroe, Okeechobee, Orange, Osceola, Pasco, Polk, St. Johns, Sarasota, Seminole, and Volusia Counties

 

Updates on the affected counties can be found at http://www.fema.gov/news/eventcounties.fema?id=3455. Borrowers not residing or working in the above counties that call requesting relief should be handled on a case by case basis by the department’s supervisor. All requests must be thoroughly documented on the borrowers’ accounts including date, time and reason for request.

 

For more guidance on this or any other regulatory relief, contact your ASA client manager.

[LynnInMN]

This information needs to be broadcast to the media so the word can get out. If they can show the looting and the trashed homes over and over again they can broadcast the less exiciting things.  So far I've seen that a lot of the auto makers are giving extensions on car payments, etc. 

 

My area was affected by two hurricanes last year, power outages, businesses shut down, etc. Until you go through this experience you can't describe it.  Leading up to the hurricane and after you spend money...afterwards, you can't cook, all your food spoils, there's a mad rush for gas. My area lost 28,000 jobs. 

 

I entered into rehab for my loans not too long afterwards.  The CA never mentioned anything about this to me and I never heard anything about it. I was never sent anything either.  I did hear about the IRS giving extensions for filing. 

 

I'm going to contact AES and see what's up.  If I'm entitled to extra forbearance or anything extra, I'm asking for it.

<{POST_SNAPBACK}>

 

 

If you in the rehab program now, and you take a forebearance, your twelve payments will start back at zero. As far as I know, at least according to my contact ant SWSS, the bulletin has not been issued yet. It usually comes out a week or two after the disaster.So wait on calling AES.

 

The CA's are told about these foreberances. We always got notices. However, we generally were not told which counties or cities. I would listen to the news to get idea of the area. The US is a big place...generally the borrower would tell us what had happened.