Can a Student Aid Bill of Rights Help Fix America's College Debt Crisis?
Airline passengers have one, and depending on the store, shoppers are protected by one. Now, thanks to President Obama, people who’ve borrowed money to pay for college will have a Bill of Rights too.
During a speech on Tuesday to a crowd of nearly 10,000 students at Georgia Tech in Atlanta, the president announced the creation of a Student Aid Bill of Rights, four new rules that will make it easier for grads to navigate the loan repayment process.
“We're going to require that the businesses that service your loans provide clear information about how much you owe, what your options are for repaying it, and if you're falling behind, help you get back in good standing with reasonable fees on a reasonable timeline,” President Obama told the crowd.
According to the Student Aid Bill of Rights, every student in America should have access to a high-quality, affordable higher education, be able to easily find the resources they need to pay for college, be able to choose an affordable repayment plan for student loans, and receive quality customer service, reliable information, and fair treatment when repaying loans.
Prior to his visit in Atlanta, President Obama signed a memorandum that mandates the creation of a centralized website where borrowers can access information about how much they owe and figure out repayment options. The website will also enable borrowers who are experiencing financial hardship to file complaints against debt collectors who are abusive or engaging in deceptive collection tactics, and it will ensure that individuals who are disabled are able to more easily get their student loans discharged. Other borrowers looking to get their loans discharged are still out of luck, but there is a ray of hope: The president said that his administration will begin looking into whether current laws prohibiting student loans from being discharged in bankruptcy need to be modified.
This Student Aid Bill of Rights doesn’t address the problem that necessitates borrowing so much cash to pay for college: the upwardly spiraling cost of higher education. However, the changes are likely to be welcome to at least some of the 40 million Americans who owe more than $1.2 trillion in student loans.
"We're trying to tackle this problem from every angle," President Obama told the Georgia Tech students. "We want to make this experience more affordable, because you're not just investing in yourselves—you're investing in your nation."