I will go to Congress and immediately offer legislation to reform the student loan industry and take this onerous burden off our children’s backs. I will legislate for the following changes:

  • No interest or payments on student loans until students have established themselves in careers and built up their income for a maximum of five years as determined by reported income on taxes – Students are now required to start repaying their loans before they’ve had a chance to establish themselves financially. This leads to increased debt through accruing interest and heightened default rates thereby ruining credit for life and inhibiting ability to create wealth and be active consumers.
  • Repayment terms on student loans of no more than 15% of income with a 20 year maximum repayment term – those with student loans are now hounded by collection agencies even to the point of garnishment of social security payments. This has contributed to over 6.8 million in default or delinquent with their credit ruined;
  • Consolidation of loans into one manageable low-interest bundle. Loans will be at the same rate as the government borrows;
  • Adding a 2% fee on all loans to be placed in a trust fund to pay for defaults;
  • Restoration of bankruptcy rights.  Student loans are some of the most difficult to discharge in bankruptcy. Student loans ruin credit, making starting business, buying a house, or being an active consumer difficult thereby inhibiting economic growth and job creation.

Solve the student debt crisis now!


Jeff Oshins for Congress student debt


 

The student debt crisis is real.

We have turned the best and brightest of our children into indentured servants working to pay off their student loans that now average in excess of $35,000 with interest rates of up to 9% (and higher if you include what is borrowed on credit cards). In 2013, the U.S. Department of Education made a greater profit on the interest on student loans than the profits of Exxon Mobil or Apple.

With little money to pay for anything else the nearly 70% of college graduates who must borrow money to complete their education cannot fully participate in the economy, start businesses or follow their dreams. In this sense, the student debt crisis is a drag on the whole economy.

Student debt falls particularly hard on women and minorities who with the same amount of student debt earn less than their male counterparts.

Student debt is distorting the college experience of exploring different career options as students concentrate on courses of study that hold the most promise of leading to a job whereby they can pay off their loans. Colleges are taking advantage of the government student loan program by passing off rate increases (300% in the last ten years) to students and their families. It now takes 5-6 years to complete a 4-year degree as impacted courses are filled up. Having to return for even a single quarter to pick up 3 units needed to graduate can cost $10,000.

On the Central Coast of California where the biggest schools are public colleges and universities, slots that once went to the children of taxpayers now go to foreign and out-of-state students who can pay higher fees.

Text books are sold at outrageous prices ($135 for a used math text book) because publishers know that the students can borrow money to pay for books.

 


Jeff Oshins for Congress student debt

 

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