Sec. 2. Findings
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Congress finds the following: The October 2014 report of the Bureau of Consumer Financial Protection titled Annual Report of the CFPB Student Loan Ombudsman noted many private education loan borrowers, who sought to negotiate a modified repayment plan when they were experiencing a period of financial distress, were unable to get assistance from their loan holders, which often resulting in them defaulting on their loans. This pattern resembles the difficulty that a significant number of mortgage loan borrowers experienced when they sought to take responsible steps to work with their mortgage loan servicer to avoid foreclosure during the Great Recession.
Although private student loan holders may allow a borrower to postpone payments while enrolled in school full-time, many limit this option to a certain time period, usually 48 to 66 months. This limited time period may not be sufficient for those who need additional time to obtain their degree or who want to continue their education by pursing a graduate or professional degree. The Bureau of Consumer Financial Protection found that borrowers who were unable to make payments often defaulted or had their accounts sent to collections before they were even able to graduate.