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Students fight Sallie Mae's forbearance fee

Cain Madden

Sallie Mae, a loan company that is not sponsored by the government, implemented a new policy of charging graduated students a $50 fee for forbearance on their student loans.
The new penalty has sparked an online petition on Change.org, with 114,714 signatures as of Monday afternoon. The petition was created by Stef Gray, a former student from Brooklyn, N.Y. Gray took out private student loans through Sallie Mae and is currently unemployed.
On Feb. 2, Gray took 76,000 signatures to Sallie Mae’s Washington, D.C., office. Three hours later, the company changed its policy and no longer pockets the unemployment penalty, but it is still charging it.
Sallie Mae only charges the $50 fee on private loans, not federal loans, according to Gray.
“I just want Sallie Mae to charge the same amounts to both federal and private loan customers, and I want to have the option of paying the fee or forbearing,” she said.
Anyone who cannot pay the extra $50 will go into default on the loan. Sallie Mae makes money off students who default.
“I’m not looking for a free handout, I’m trying to make a difference for the thousands of people before me and the thousands of people who will come after me,” Gray said. “I want to fight student loan debt.”
Sallie Mae also does not offer loan consolidation, and if a borrower has several private loans, he or she might have to pay up to $150.  
Martha Holler, spokesperson for Sallie Mae, said when customers experiencing temporary financial difficulty ask to suspend scheduled payments, Sallie Mae asks for a good-faith payment to emphasize the terms and long-term implications of their decision to use forbearance.
The payment goes on customers’ balances after they resume making payments on time, according to Holler.
Gray said Sallie Mae advertises in financial aid offices all over the nation but doesn’t really help students.
“The student loan crisis stuck a lot of people where they don’t want to be in their lives, and this is financial suicide for the American dream,” she said. “People can never rent a car, apartment, get married; it’s a very toxic situation.”
Melissa Roughton graduated from the University of Southern Mississippi in 2006. In 2010, she finished her master’s degree from New England College. Between her bachelor’s and master’s degrees, Roughton has about 10 Sallie Mae loans she is still paying off.
“If you have a private loan through them, then you can pretty much guarantee that you will not be treated very well,” Roughton said. “I have had their customer service representatives tell me that I need to get a better-paying job and that I must be stupid to have a job that makes me not able to pay my student loans.”
Roughton also said she has dealt with different customer service representatives that have been more respectful and helpful, but she said Sallie Mae generally doesn’t care about students; they just care about getting their money.
Students can get involved by signing the petition at Change.org or by emailing Gray at studentdebtaction@gmail.com.
Change.org’s senior organizer William Winter said campaigns like Gray’s are an example of the website’s platform, which is standing up to corporate giants and making a difference.
“I think it’s exciting that Stef has been able to accomplish what she has accomplished over the course of three weeks,” he said. “Change.org is empowering ordinary people to take action against issues that matter to them.”