[Congressional Record (Bound Edition), Volume 161 (2015), Part 2]
[Extensions of Remarks]
[Page 2869]
[From the U.S. Government Publishing Office, www.gpo.gov]




                  FAIRNESS IN STUDENT LOAN LENDING ACT

                                 ______
                                 

                           HON. JIM McDERMOTT

                             of washington

                    in the house of representatives

                      Thursday, February 26, 2015

  Mr. McDERMOTT. Mr. Speaker, in an effort to provide students and 
families much need relief and protection from crippling student loan 
debt, Congressman Jim McDermott (D-WA), a senior member of the Budget 
and Ways and Means Committees, today introduced legislation that would 
save students and parents thousands of dollars by allowing student loan 
borrowers to refinance their federal and private student loans. The 
Fairness in Student Loan Lending Act will also allow holders of private 
student loans the ability to discharge their debt in bankruptcy, which 
is not currently permitted.
  Federal law currently prevents responsible student loan borrowers 
with federal student loans in good standing from refinancing their 
loans to a lower rate. This has left millions of students and parents 
holding loans with interest rates of 7 percent. Under the Fairness in 
Student Loan Lending Act, student loan borrowers in good standing will 
be able to refinance their loans to a rate equal to the 10-year 
Treasury note on the last day of business of the previous month plus 
one percent. For example, a borrower who refinances on February 2015 
would refinance to a rate of 2.64%.
  While federal law allows borrowers to discharge many types of debt 
during bankruptcy, including car loans and gambling debt, student loans 
holders are not permitted to discharge their student loans during 
bankruptcy. The Fairness in Student Loan Lending Act provides a 
mechanism that allows borrowers holding private loans the ability to 
discharge these private loans during bankruptcy.

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