Murkowski, Reed, Braun Introduce Bills to Address Student Loans
WASHINGTON, DC – U.S. Senators Lisa Murkowski (R-AK), Jack Reed (D-RI), and Mike Braun (R-IN) have introduced two bills to address the rising cost of post-secondary education: the State-Based Education Loan Awareness Act and the Student Loan Repayment Freedom Act.
The State-Based Education Loan Awareness Act would eliminate deterrents and penalties that prevent universities from informing students about student loans offered by non-profit, state agency lenders whose mission is to make college affordable and accessible. Click here for more information on the State-Based Education Loan Awareness Act.
“I am well aware of the ever-rising cost of college and the barriers that young people face in affording post-secondary education, which is why I’ve made it a priority to help make pursuing these opportunities a more attainable reality for all Alaskans. The opportunity to learn and pursue a degree or job skills should never be hampered by the fear of not being able to afford school,” said Senator Murkowski. “It is important that we enable colleges to help students seek out affordable loans offered by the non-profit state agencies created to serve them once they have exhausted their federal student aid options. I’m proud to lead this bill alongside Senator Reed that will open up greater opportunities for the next generation of learners.”
“The reality of paying for college is tough and it’s important for students and families to understand the costs and have accurate and complete information about their financial options,” said Senator Reed. “Far too many students are unaware about additional resources state agencies can provide. This bill will help to shine a light on additional low-cost options to help pay for college.”
“Colleges should be able to inform students of all the resources available that can make higher education more economical and accessible, such as student loans offered by non-profit state agencies,” said Senator Braun. “I am proud to join Senator Murkowski and Senator Reed in introducing legislation that will help expand opportunities for Hoosiers in higher education.”
The Student Loan Repayment Freedom Act will help federal student loan borrowers to ensure their repayment plans fit their needs by allowing borrowers to switch from one income-based repayment plan to another, without first having to make a payment under Standard Repayment or go into forbearance. Click here for more information on the Student Loan Repayment Freedom Act.
“Many federal student loan borrowers sign up for one of the income-based repayment plans, only to realize that as their circumstances change, another plan would better meet their needs. Unfortunately, the Department of Education requires borrowers to first move to Standard Repayment, fill out reams of paperwork, and wait for their loan servicer to process that paperwork. The Student Loan Repayment Act aims to simplify that process, giving borrowers the ability to move from one plan to another that best suits their needs, with the least amount of hassle,” said Senator Murkowski. “We need to make the process of repaying federal student loans as easy and stress-free as possible. This legislation gives us the opportunity to do just that.”
“Repaying federal student loans can be a confusing, stressful, and expensive challenge for many students. It’s important that student borrowers are able to switch to a repayment plan that fits their needs without endless delay or red tape,” said Senator Reed. “The Student Loan Repayment Freedom Act puts borrowers in the driver’s seat and makes it easier for them to select the plan that fits their specific needs.”
“We must put an end to the unnecessary bureaucratic obstacles that hinder federal student loan borrowers from switching to an income based-repayment plan that best suits their needs,” said Senator Braun. “The Student Loan Repayment Freedom Act streamlines the federal student loan repayment system and reduces the burden on students.”
What stakeholders are saying:
“Research conducted by the Alaska Commission on Postsecondary Education (ACPE) consistently reflects the startling reality that Alaska’s student loan borrowers pay more than is necessary to fund their postsecondary education endeavors. When our students are not appropriately and accurately informed of State and non-profit education loan programs, research indicates they are at risk of taking loans with interest rates that could be up to double those available through their state lender’s programs. ACPE supports the efforts of Senator Murkowski to ensure Alaskan students are better informed and prepared to make sound financial decisions in pursuing postsecondary education programs,” Sana Efird, Executive Director of the Alaska Commission on Postsecondary Education.
“Requiring borrowers who are paying according to an income-driven repayment plan make a payment in standard repayment or put loans into forbearance to enroll in a different income-driven repayment plan is an administrative hurdle that should be eliminated. Your bill changes this and will reduce confusion for borrowers, avoid unnecessary processing delays, and help update the archaic federal student loan repayment system,” said Gail daMata, President, Education Finance Council.
"Borrowers, whether student or parents, face a daunting task of navigating the student financial loan landscape. Likewise, institutions of higher education face a strict and cumbersome process of identifying lenders to borrowers. Dedicated financial aid officers at institutions work to find the right solutions and options for students. This legislation enables state-based lenders to be eligible for listing by institutions without the burdensome regulatory process used currently," said Dr. Paul Layer, Vice President for Academic Affairs of University of Alaska.
The Education Finance Council (EFC) has endorsed both pieces of legislation. To read their letter of endorsement regarding the State-Based Education Loan Awareness Act, click here. To read their letter of endorsement regarding the Student Loan Repayment Freedom Act, click here.