[Congressional Record (Bound Edition), Volume 161 (2015), Part 5]
[House]
[Page 6748]
[From the U.S. Government Publishing Office, www.gpo.gov]




            BANK ON STUDENTS EMERGENCY LOAN REFINANCING ACT

  The SPEAKER pro tempore. The Chair recognizes the gentleman from 
Connecticut (Mr. Courtney) for 5 minutes.
  Mr. COURTNEY. Mr. Speaker, yesterday, May 13, was a significant day 
for 15 million college students who are entering next year's academic 
year because it is the day that the U.S. Department of Treasury, based 
on their auction of 10-year notes, sets the interest rates for the 
Stafford student loan program for all those students who will be 
borrowing for next year.
  The good news is that, based on yesterday's auction, where 10-year 
notes sold for 2.29 percent, the interest rates for next year's 
Stafford student loan program will be 4.29 percent, which is actually 
lower than last year's Stafford student loan interest rates. It is a 
savings of about a third of a percent--not a huge amount, but certainly 
headed in the right direction.
  This is because in 2013, we passed the Bipartisan Student Loan 
Certainty Act which prevented a doubling of interest rates for the 
Stafford student loan program. It was slated to go to 6.8 percent and, 
tying it to the interest charged by the Department of Treasury, 
moderated those costs for, again, 15 million college students all 
across the country who used the Stafford student loan program.
  That news event yesterday, though, begs the larger question, which 
is: What about all those people who are carrying high interest rate 
student loans who have already graduated over the last 10 years or so?
  The Federal Reserve Board tells us that over $1 trillion of student 
loan debt overhangs the U.S. economy today, more than car loan debt and 
more than credit card loan debt.
  The trap that many of those people find themselves in is that they 
cannot refinance that debt because it is noncollateralized loans and 
that those who hold it in the public sector, in the Stafford student 
loan sector, again, cannot, by law, refinance down and take advantage 
of these low interest rates that the Federal Government is benefiting 
from because of monetary trends in markets that exist today.
  Well, the good news is that there is a measure before the Congress, 
the Bank on Students Emergency Loan Refinancing Act, H.R. 1434, which 
would allow people both with private student loan debt and public 
student loan debt to refinance those loans down to 3 percent, taking 
advantage, again, of the fact that we have a very beneficial 
environment right now in terms of government borrowing.
  Today, the Federal Government actually makes money off those 
graduates who are paying 8 percent, 9 percent, 10 percent interest on 
their loans, which is unconscionable given the fact that that debt is 
causing great damage to those individuals in terms of starting their 
lives.
  The Pew Research Center actually issued a report last year where it 
talked about the fact that 40 to 50 percent of people in their twenties 
and early thirties are delaying marriage, they are delaying starting a 
family, and they are basically denied the access to get a starter home 
or a real estate mortgage because their debt to income ratios are 
thrown completely off kilter due to the fact that they are carrying 
such high rates of student loan debt.
  The Congressional Budget Office tells us that H.R. 1434 would 
basically result in half of that trillion dollars of debt being written 
down, putting millions of dollars of money into people's pockets that 
they can spend on things in terms of getting their lives started.
  Again, it is important to note this is not a giveaway by the 
government; these folks are paying back the loans that they were able 
to acquire from the Stafford student loan program, but it allows them 
to moderate their interest rate to comport with what is out there for a 
30-year loan for a house or for credit cards or for car loans which, 
again, are lower than what student loan debt is today.
  H.R. 1434 has 128 cosponsors in the House. Mr. Speaker, it is time 
for us to take up this emergency loan refinancing act to provide 
critical help for individuals who are getting killed out there with 
monthly payments and, again, inhibiting them to start their lives and 
do the steps in life that people in their twenties and thirties have 
done in generations before.
  Sadly, we saw a budget resolution pass a couple weeks ago--the House 
Republican budget resolution--that not only failed to take advantage of 
the fact that the government is able to borrow at historic low rates, 
but, in fact, compounds the problem because it is going to allow the 
Federal Government to charge interest while students who are carrying 
Stafford student loans in school are going to have interest charged 
while they are in school.
  Traditionally, the Stafford student loan program has provided one 
good benefit, which is they don't charge interest while a young person 
is in their freshman, sophomore, or junior year. The Republican budget 
actually changed that rule so that interest is going to accumulate 
while students are in college, adding to their debt burden at the time 
that they graduate.
  We need to address this problem; pass H.R. 1434. Let's take advantage 
of these low interest rates. Let's help millions of Americans get a 
better start on life.

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