Student Loan Bill of Rights Update | Connecting Point | July 22, 2019
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Student Loan Bill of Rights Update | Connecting Point | July 22, 2019


>>THE STUDENT BILL OF RIGHTS
LEGISLATION IS MAKING HEADWAY IN THE MASSACHUSETTS LEGISLATURE. THE BILL WOULD ALLOW THE STATE
TO REGULATE STUDENT LOAN SERVICERS AND HELP BORROWERS
KNOW AND UNDERSTAND THEIR RIGHTS, AND EVEN HELP INTERVENE
IN THE CASE OF A DISPUTE WITH THE LOAN SERVICERS. I SAT DOWN WITH STATE
REPRESENTATIVE NATALIE HIGGINS AND STATE SENATOR ERIC LESSER TO
LEARN MORE.>>THIS PROTECTS MASSACHUSETTS
RESIDENTS REGARDLESS OF WHERE THEY TOOK OUT THEIR LOANS, IF
THEY’RE LIVING HERE IN MASSACHUSETTS, IT ADDS
PROTECTIONS AND STRENGTHENS WHAT OUR ATTORNEY GENERAL ALREADY IS
DOING TO PROTECT STUDENT LOAN BORROWERS, AND SETS UP A
REGULATION — REGULATORY SCHEME TO LICENSE STUDENT LOAN
SERVICERS WHO ARE SERVICING LOANS HERE IN MASSACHUSETTS. AND ALSO ESTABLISHES THE OFFICE
OF THE STUDENT LOAN OMBUDSMAN TO PROVIDE SUPPORT.>>AND SO THERE’S BEEN SOME NEW
DEVELOPMENTS WITH THIS BILL THAT’S BEEN FILED IF YOU CAN
SHARE THAT.>>THIS IS THE SECOND SESSION
THIS BILL HAS BEEN FILED. IT MADE IT TO THE SENATE LAST
SESSION THANKS TO THE SENATOR LESSER AND THIS IS THE FIRST
TIME IT MADE IT IN THE COMMITTEE OF HOUSE. IT PASSED FAVORABLE OUT OF
FINANCIAL SERVICES WHICH IS GREAT NEWS AND, HOPEFULLY,
SIGNALS IT’S GOT SOME MOMENTUM TO MAKE IT THROUGH THE HOUSE
THIS SESSION.>>AND WHAT SPECIFIC THINGS ARE
YOU HEARING FROM YOUR CONSTITUENTS AS TO WHAT’S BEEN
HAPPENING AS FAR AS THESE STUDENT LOANS SERVICERS.>>WE’RE REALLY IN A CRISIS WITH
STUDENT LOANS. AND I THINK IT’S IMPORTANT TO
POINT OUT IT IS VERY WIDESPREAD. NEARLY 900,000 PEOPLE IN
MASSACHUSETTS RIGHT NOW HAVE A PENDING STUDENT LOAN AND THE
AVERAGE LOAN IS OVER $30,000 PER PERSON SO THIS IS A CRISIS, $33
BILLION, A BILLION DOLLARS GETS ADDED EVERY YEAR BUT WHAT THIS
MEANS, YOU KNOW, FOR THE AVERAGE PERSON WHO’S STRUGGLING, I HEAR
YOU GOT A TIMING OF PEOPLE JUST MEYERED IN — MIRED IN INTEREST
PAYMENTS THAT CONTINUE TO BALLOON AND SKIROCKET AND REALLY
GOOD HORRIFIC STORIES. I HAD A CONSTITUENT IN EAST LONG
MEADOW WHO REG MOVED TO CONNECTICUT. SHE HAD BEEN DIAGNOSED WITH
CANCER. SHE HAD TWO YOUNG CHILDREN. SHE WAS PAYING DOWN A LOAN FROM
GETTING HER SPECIAL EDUCATION DEGREE TO BE A SPECIAL EDUCATION
TEACHER. THIS IS THE KIND OF WORK WE WANT
PEOPLE DOING TO GO OUT TO GET THIS TYPE OF EDUCATION. WE HAVE A SHORTAGE OF SPECIAL ED
TEACHERS, AND SHE WAS SAYING THAT THE COMPANY JUST WOULDN’T
RESPOND, WOULDN’T EVEN RESPOND WHEN SHE WOULD REACH OUT AND ASK
THEM FOR A DELAY IN PAYMENTS OR SOME TYPE OF BREAK WHILE SHE WAS
TRYING TO FRONT MEDICAL BILLS FOR HER KEEP IN MIND THERAPY AND
AT THE SAME TIME SHE WAS TRYING TO PAY DOWN HER STUDENT LOANS. SHE MOVED TO CONNECTICUT WHERE
THEY HAVE A STUDENT LOAN BIG OF RIGHTS ON THE BOOKS. THEY HAVE A STUDENT LOAN
OMBUDSMAN SIMILAR TO WHAT WE’RE TRYING TO CREATE HERE IN
MASSACHUSETTS, AND IN CONNECTICUT SHE HAD STATE
GOVERNMENT ON HER SIDE WORKING WITH HER TO NEGOTIATE WITH THE
SERVICER. THEY WERE ABLE TO GET HER
INTEREST PAYMENT DISCOUNT TO 1% — PAYMENT DOWN TO 1%. IT’S TO REALLY HELP PEOPLE
NEGOTIATE WITH THESE REALLY MONSTROUS COMPANIES — WE’RE
TALKING 1.5 TRILLION DOLLAR INDUSTRY AND THEY’RE REALLY
DOING EVERYTHING THEY CAN TO TRY TO AT BEST BE UNRESPONSIVE, AT
WORST DELIBERATELY MISLED PEOPLE TO DEFAULT INTO FALLING DOWN ON
THEIR PAYMENTS.>>SO THE REPRESENTATIVE IN THE
STATE, THE OMBUDSMAN WOULD ACTUALLY WORK ON THE BEHALF OF
THE CONSUMER SO THEY SAY, OKAY, I’M IN THIS SITUATION WHERE I
HAVE AN ILLNESS OR SOME OTHER EMERGENCY IN MY FAMILY AND YOU
WOULD ACTUALLY CALL THEM AND THEY WOULD KIND OF, YOU KNOW,
INTERVENE FOR YOU?>>YEAH, AND WOULD ACTUALLY BE
ABLE TO COLLECT THAT AGGREGATE DATA WHAT ARE MASSACHUSETTS
RESIDENTS FACING IN TROUBLE WITH THEIR STUDENT LOAN DEBT AND BE
ABLE TO PASS THAT ON ALSO, THE ATTORNEY GENERAL HAS BEEN A
LEADER IN TAKING OR THESE STUDENT LOAN SERVICING COMPANIES
WHEN THEY’RE ACTING FRAUDULENTLY FOR SO MANY STUDENT LOAN
BORROWERS THEY’RE NOT ABLE TO GET INTO INCOME-BASED REPAYMENT
PROGRAMS BECAUSE THEY’RE BEING COUNSELED AGAINST THAT AND GOING
INTO FINANCIAL HARDSHIP. IN MY CASE WITH MY OWN STUDENT
LOAN DEBT I WAS KICKED OUT OF MY INCOME-BASED REPAYMENT PLAN,
MISSED A NOTIFICATION, WENT FROM HAVING $400 TAKEN OUT OF MY BANK
ACCOUNT TO $1300 TAKEN OUT OF MY BANK ACCOUNT. I KNEW WHAT MY RIGHTS WERE. I KNEW I COULD STOP THAT PAYMENT
AND GET THAT MONEY BACK AND WASN’T LATE ON MY MORTGAGE. I WORRY HOW MANY MORE OF
MASSACHUSETTS RESIDENTS DON’T KNOW HOW TO REACT WHEN THEY HIT
ONE OF THESE WALLS WITH THEIR STUDENT LOAN SERVICERS.>>WHAT WAS THE RESPONSE, YOU
KNOW, WHEN YOU CALLED THE COMPANY WAIT A SECOND, YOU JUST
TOOK $1300 OUT OF MY ACCOUNT.>>THERE WAS A LOT BEING PASSED
AROUND TO PERSON-TO-PERSON A LONG TIME ON THE PHONE AND MY
BANK WAS REALLY GREAT BUT IT WAS FRUSTRATING I’M TRYING TO DO THE
PUBLIC SERVICE LOAN FORGIVENESS PROGRAM WHICH MEANS MY LOANS
WENT INTO DEFERMENT. I DON’T GET TO MAKE PAYMENT ON
MY STUDENT LOAN DEBT IT PUSHES THAT 10-YEAR PAYMENT PLAN
FURTHER OUT AND IT’S REALLY FRUSTRATING. I’VE BEEN ABLE TO PAY MORE ON MY
MORTGAGE THAN I HAVE ON MY STUDENT LOAN DEBT IN THE TIME
I’VE BEEN OUT OF LAW SCHOOL MY STUDENT LOAN DEBT HAS ECLIPSED
MY HOME MORTGAGE. I’M LUCKY TO BE A MILLENNIAL TO
BE INVESTING IN CONNECT IN MY HOME AND POTENTIALLY MY
RETIREMENT BUT THE STUDENT LOAN DEBT MAKES IT SO HARD FOR ME AND
MY PARTNER TO MANAGE OUR FINANCES.>>MOST WHAT WE’RE TALKING
ABOUT, RIGHT, IS FEDERAL LOANS AND PEOPLE WOULD ARGUE IF THESE
ARE FEDERAL LOANS THEN THEY SHOULD BE REGULATED FEDERALLY
NOT THROUGH THE STATE?>>WELL, IN A PERFECT WORLD THEY
WOULD BE REGULATED FEDERALLY AND I THINK IT’S WORTH POINTING OUT
THAT THE DODD-FRANK WALL STREET WHICH ELIZABETH WARREN CREATED A
NEW CFPB TO REGULATE THESE LOANS BUT SINCE PRESIDENT TRUMP HAS
TAKEN OFFICE AND HIS APPOINTEES TOOK OVER THE AGENCY THERE
HADN’T BEEN A SUBSTANTIVE ENFORCEMENT ACTION OVER STUDENT
LOAN SERVICERS SINCE THAT TIME AND, IN FACT, THEY’VE DONE THE
OPPOSITE AND ROLLED BACK THE PROTECTIONS SO THEY CAN CONTINUE
TO — WHILE WE HOPE THAT STOPS IN WASHINGTON BUT IN
MASSACHUSETTS WE CAN’T WAIT FOR THE SYSTEM TO CATCH UP IN DC. WE ARE A STATE THAT IS DEPENDENT
ON HAVING HIGH NUMBERS OF COLLEGE-EDUCATED GRADUATES. WE DON’T HAVE THE BEST WEATHER. WE DON’T HAVE, YOU KNOW, OIL IN
THE GROUND. WE DON’T HAVE NATURAL RESOURCES
TO EXTRACT. WE HAVE PEOPLE, WE HAVE THE MOST
TALENTED PEOPLE AND IT’S A THREAT TO OUR ECONOMY AND TO OUR
STATE IF YOUNG PEOPLE ARE NOT ABLE TO GET THE EDUCATION THAT
THEY NEED BECAUSE THEY’RE AFRAID OF THESE REALLY ABUSIVE PRATS BY
THESE SERVICERS. THE OTHER THING I WOULD POINT
OUT IS THAT THE STATE REGULATES ALL TYPES OF ACTIVITY. YOU NEED A LICENSE IN
MASSACHUSETTS TO CUT HAIR, YOU NEED A LICENSE TO SELL A CAR,
YOU NEED A LICENSE TO SELL INSURANCE. YOU NEED A LICENSE TO SELL OR
MANAGE REAL ESTATE BUT YOU DON’T NEED A LICENSE TO SERVICE A LOAN
FOR 150, $200,000 THAT WOULD ARGUABLY BE ONE OF THE MOST
IMPORTANT AND SUBSTANTIAL FINANCIAL DECISIONS A PERSON
WILL EVER MAKE. THAT’S NOT RIGHT SO WE ARE ON
VERY STRONG GROUND IN TERMS OF THE PRECEDENCE HERE OF THE STATE
BEING ABLE TO REGULATE CONSUMER ORIENTED ACTIVITY TO ENSURE
THERE’S NO FRAUD AND ENSURE THERE’S GOOD FAIR TRANSPARENT
PRACTICES AND IF THE FEDERAL GOVERNMENT WANTS TO CHALLENGE
IT — IF WE’RE NOT WILLING TO TAKE A STAND AND TO FIGHT ON
SOMETHING LIKE THAT, I DON’T KNOW WHAT MASSACHUSETTS IS GOING
TO BE WILLING TO FIGHT ON. SO I THINK IT’S SOMETHING THAT
WE NEED TO LEAN INTO.>>AND HOW MANY OTHER STATES
HAVE FOLLOWED SUIT? I KNOW OTHERS HAVE PASSED
SIMILAR LAWS. I KNOW YOU SAID CONNECTICUT IS
ONE OF THEM.>>THERE’S BEEN ABOUT A DOZEN
AND THERE ARE MORE COMING ALMOST EVERY DAY. COLORADO JUST A FEW MONTHS AGO
PASSED A STUDENT LOAN BILL OF RIGHTS, MAINE ALSO JUST PASSED A
STUDENT LOAN BILL OF RIGHTS, MISDEMEANOR WHERE THERE’S A ARE
YOU NOT GOVERNOR, LARRY HOGAN SIGNED A STUDENT LOAN BILL OF
RIGHTS JUST INTO A MONTH AGO, 6 WEEKS AGO SO THERE’S A LOT OF
MOMENTUM. SO WE’RE HOPING, UNFORTUNATELY,
THIS IS NOT A PLACE WHERE MASSACHUSETTS IS REALLY NUMBER 1
IN BUT WE’RE HOPING OUR LAW IS THE BEST AND MOST THOUGHT OUT
AND CAN GET PASSED, HOPEFULLY, IN THE NEXT FEW MONTHS.>>WHAT’S THE NEXT STEP WITH
THIS LEGISLATION?>>THE NEXT STEP IS REALLY
HAVING THE CONVERSATIONS WITH OUR COLLEAGUES AND MAKING SURE
THAT THE URGENCY, THAT SENSE OF URGENCY IS THERE AND I THINK AS
WE’VE SEEN THE TRUMP ADMINISTRATION ROLL BACK
PROTECTION GUESS FOR BAUERS WE CAN’T WORRY ANYMORE. AS SENATOR LESSER SAID, WE
LICENSE ALL OTHER KINDS OF LOAN SERVICERS, MORTGAGE SERVICERS,
AUTO LOAN SERVICERS SO THIS IS — THIS IS A HUGE IMPACT ON
MASSACHUSETTS RESIDENTS AND WE NEED TO MAKE SURE THAT THEY’RE
PROTECTED. ♪

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