Student Loan Bill of Rights advances

Daniel Biss.

Legislation sponsored by State Sen. Daniel Biss (D-Evanston) that he says would protect Illinois college students from crushing education debt advanced out of a Senate committee today.

Senate Bill 1351 establishes the Student Loan Bill of Rights in Illinois to protect student borrowers, a population that Biss says is frequently targeted by bad actors in the student loan industry.

“At a time when a quarter of student loan borrowers are behind in their payments, we need to make sure borrowers understand their rights and have access to resources that will prevent them from defaulting on their loans,” Biss said. “I am pleased to work with Attorney General Lisa Madigan on behalf of student borrowers, and I encourage each of my colleagues to support this measure.”

The Student Loan Bill of Rights would help to ensure students and their families receive clear information about the money they borrow for higher education and how their student loans are serviced. The legislation would:

  • Require student loan services to provide specialized employees to assist borrowers with questions about loan payments, explain repayment options and evaluate a borrower’s financial situation to determine which payment plan is appropriate.
  • Require loan servicers to give borrowers accurate information on billing statements and properly process borrowers’ payments, and bar servicers from charging unreasonable fees.
  • Require loan servicers to tell borrowers when and how their federal loans may be discharged due to a borrower’s disability or a problem with the school the borrower attended.
  • Require loan servicers to provide information so cosigners know the conditions of being released from their obligations.
  • Require servicers to follow procedures when a loan is transferred to a new servicer to ensure continuity and ensure borrowers’ payments are properly handled.
  • Ensure borrowers have the right to request information and file account disputes with their servicer and appeal any servicer determination.
  • Create a student loan ombudsman in the office of the attorney general to assist borrowers with student loans.
  • Establishe a student loan servicing license with the Illinois Department of Financial and Professional Regulation to qualify, oversee and discipline services for violating the Student Loan Bill of Rights.

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Comments

Fine and good, but...

Only a few brave souls want to talk about why college costs so much.

Student, and even parents, want every possible nrew building, major [no matter how useless or not leading to a well-educated student], VPs and SVPs for every possible 'need' [read hand-holding], lack of information provided to students about jobs and how their major will help them get a job---and if they even have the knowledge/skills to get those jobs. Not to mention the high salary paid to levels of administration---anyone who has worked knows senior management are treated as the greatest thing since sliced bread---until they are fired and the company says they 'were not up to the job'---same with college adm. from AVP to President. Also the fact that they are running up the debt---so they better have a plan to re-pay it and not count on 'foregiveness.'

In all the student debt stories, they don't mention how the housing costs they probably plan to have [$400,000+] will swamp their college debt.

More savings

How much would an NU save students if they turn their "pre-pro" football and basketball teams into intra-mural programs, require PE for all student so ALL students can get physical ed. instead of supporting a few 'jock' want-a-be's. If not that then put the pay level of the coaches on par with English teachers and put sports and Kellogg under the university 'at large' budget, i.e. going into the general education pool.

Federal matter

I don't quite understand how a state law would "protect" students (and their parents) against a federal law: 1998 Higher Education Amendments act enacted by Clinton administration.

With one document it started inflating education costs (once you subsidize something, you get more of it) and made loans non-dischargeable.

College costs high cuz student loans too EZ to get

The No. 1 reason why collge tuition is so high and growing is because banks give out student loans to anyone with a pulse.

Banks do this cuz they know the feds will back them on loan defaults. The feds under Bill Clinton enacted a direct student loan program with the banks acting as intermediaries.Students could get EZ loans directly from the feds. Hillary Clinton proposed a $155 billion student loan forgiveness program as if that would stop the ruanway college expenses.

Universities keep raising tution cuz they know it's way too easy for a student to get a loan.

America's student debt load is $1.5 trillion and growing. It is a bubble ready to burst. 

Solution: tighten student loan regulations.