WASHINGTON, DC – Congressman Brian Fitzpatrick (PA-08) has introduced legislation with Congressman John Garamendi (D-CA) to address the ballooning student loan debt crisis in America that cripples over 40 million Americans and their families.
The bipartisan Student Loan Refinancing and Recalculating Act would allow students to refinance their student loan interest rates, lower future student loan interest rates, eliminate origination fees on student loans, delay student loan interest rate accrual for low-income and middle-class borrowers while they are pursuing their education, and allow for borrowers in medical or dental residencies to defer payments until the completion of their program.
“We need to revolutionize American education and job training so we’re preparing students for a 21st century job market. That means, among other things, reducing barriers to educational opportunities and post-graduation success,” said Fitzpatrick. “For too many, student loan debt is a crippling burden that impacts their involvement in our economy and achieving personal goals like owning a home, starting a family and supporting their community. This bipartisan legislation is a step toward addressing this crisis.”
The total student loan debt in America has reached $1.3 trillion, and over $875 billion of it is held by the federal government at interest rates of up to 6.84%. That percentage far exceeds the market rate for most government loans.
“For many Americans, the price of a college education is too high. The average 2016 graduate owes over $37,172 in student loan debt. This mountain of debt prevents graduates from reaching important milestones such as starting a family, buying a house, or opening their own business,” Garamendi said. “This bill would help relieve some of the debt burden faced by American students and their families, while ensuring that the federal government is not making a profit on the backs of students.”
Jean Rash, Chair of the Higher Education Loan Coalition, urged support for the legislation. “By refinancing student loan rates for past borrowers and recalculating rates for future borrowers, this bipartisan bill would establish fairer and market-driven loan terms for all borrowers. Additionally, delaying student loan interest rate accrual for low-income families will ensure financial support to those students who need it the most. Students and families also would benefit immensely from the bill’s elimination of origination fees. We believe such changes will have a real and lasting impact on helping make college more affordable.”
“Orthodontists now graduate with an average of $365,000 in student loans. The AAO supports this legislation because it focuses on reducing the enormous debt load our residents and graduates currently face,” said Dr. Nahid Maleki, President of the American Association of Orthodontists. “Reducing interest rates and fees and allowing refinancing for today’s graduates are critical steps to helping them repay these loans sooner and more efficiently so they can begin to invest in their futures and careers.”