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Iowa agency working to recover defaulted student loans

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March 29th, 2018 by Ric Hanson

DES MOINES, Iowa (AP) — An Iowa agency is making a new effort to recover more than $9.4 million in defaulted private student loans, including some that date back to the 1990s. The Des Moines Register reports that the state College Student Aid Commission has entered into an agreement with the state Department of Revenue to recover more than $9.4 million in Iowa Partnership Loans.

The agreement says the Revenue Department will use a variety of methods to collect the defaulted loans from almost 1,000 borrowers, including garnished wages and withheld state income tax refunds. The Revenue Department will keep 28 percent of the funds collected.

The commission worked with the Iowa Student Loan Liquidity Corp., a private nonprofit, to administer the loan program. The commission then purchased the private loans in default from 1998 to 2006.