WASHINGTON — As lawmakers negotiate a new version of the Higher Education Act, one member of Congress is floating a number of proposals to combat rising student loan debt.
- Congress negotiating terms of all-encompassing higher education bill
- Sen. Marco Rubio floating proposals to combat student loan debt
- He's introduced LOAN Act, Protecting JOBs Act (w/ Elizabeth Warren)
- RELATED: Bipartisan Bill Goes After Hidden Student Loan "Tax"
“I, myself had over $100 thousand of student loans when I graduated,” said Sen. Marco Rubio (R-Florida) in an interview with Spectrum News.
It took Rubio 16 years to pay off his student loan debt after graduating from the University of Miami School of Law in 1996. Now, he’s on a mission to reduce the financial hardship for others in the future.
“In many cases, the interest payments end up being larger than the loan itself,” he explained.
That’s the inspiration behind a new bill he introduced called the Leveraging Opportunities for Americans Now (LOAN) Act. If passed into law, the bill would allow students to pay a flat rate, generally 25 percent of the loan, which would not grow over time like interest.
“It puts everybody automatically on an income-based repayment plan. You can always pay more, pay extra to get rid of the loan sooner. So, the combination of those two things including not allowing this interest to compound year in and year out,” he said.
“This is something that adds to the conversation about the best way that students can borrow and successfully repay their loans,” said Emily Bouck West, the Deputy Executive Director of Higher Learning Advocates, a bipartisan nonprofit focused on education policy.
West, who served as the Deputy Legislative Director to Rubio, said one of the Senator’s other bills that would require more transparency from universities about tuition costs and fees has been gaining traction over the years.
“When today’s students are looking to choose the best program, if they had more information about expected loan balance, expected time to pay their loans and more information about outcomes by program basis, I think that would be really helpful,” she said.
While some Democrats in Congress are skeptical of a few of those proposals, the Senator is teaming up with Sen. Elizabeth Warren (D-Massachusetts). They’re working to make it illegal for states to deny job licenses to those who default on their student loans, introducing a bill called the Protecting JOBs Act.
“It makes no sense that if you owe student loans, we are going to take away your license to do the job that allows you to make the money you need to pay back those loans,” Sen. Rubio said.
“This is a time to get it right,” he added.
All these ideas come as Congress negotiates terms of an all-encompassing higher education bill, expected to be the first update to the law since 2008.