College grads and others who are unable to make payments on certain student loans could find it even tougher to dig out of debt now that it's possible to be hit with double-digit collection fees.
The fees — which could be as high as 16% — started creating buzz in mid-March after a policy revision was issued by the U.S. Department of Education. It's yet another reminder of why borrowers should do all that's possible to avoid defaulting on student loans.
Ever since July 2015, agencies that collect on defaulted debt were forbidden by the Obama administration from tacking on a hefty fee if students began repaying within 60 days of a default. Those who defaulted and rehabilitated after 60 days were still subject to the fee.