House Committee Markup on Student Loan Bill is Misguided

January 31, 2024 — Press Release

Advocates caution bill would increase costs for struggling students

BOSTON — This morning, during the House Committee on Education & the Workforce’s markup of Chairwoman Virginia Foxx’s College Cost Reduction Act (H.R. 6951), Abby Shafroth, Director of the National Consumer Law Center’s Student Loan Borrower Assistance Project, issued the following statement:

“Despite its name, the College Cost Reduction Act would actually further increase the cost of college or career training for many Americans, especially the millions who rely on student loans to afford tuition. This bill would increase borrowers’ monthly student loan payments and eliminate the promise that borrowers will be debt free after a certain number of years of making payments. Instead, this bill would leave some borrowers stuck in debt for the rest of their lives, simply because they sought an education. 

“The bill would also eliminate the troubled Parent PLUS loan program, which has left too many parents with unaffordable debt, but fails to provide alternative funding to bridge the gap for the low-income, and disproportionately Black, families who have relied on the program to cover the cost of college. 

“Additionally, the bill would repeal critical protections against schools that prey on students for their financial aid dollars, making it more likely that students and taxpayers will waste money on worthless degrees.

“The tremendous downsides of the bill outweigh its good cost reduction ideas, including restructuring income-driven repayment so that when borrowers make payments their balances go down, fully eliminating interest capitalization, and doing away with origination fees.

“We urge members of the House Education Committee to reject the so-called College Cost Reduction Act and to pursue legislation that would truly reduce the cost of education for working and middle-class students and their families, ensure access to education, prevent student loan distress from pushing families into poverty, and protect students and taxpayers from having their investment in education wasted.”   

Additional Resources:

• Group letter opposing the College Cost Reduction Act (Jan. 30, 2024)
• Abby Shafroth, Op-Ed: Ending the Black Hole That’s Devouring Student Loan Payments (The Hill, Jan. 18, 2023)
• NCLC Recommendations for Higher Education Act Reauthorization (March 2020)
• NCLC’s Student Loan Borrower Assistance Website

The NCLC’s Student Loan Borrower Assistance Project provides information about student loan rights and responsibilities for borrowers and advocates. We also seek to increase public understanding of student lending issues and to identify policy solutions to promote access to education, lessen student debt burdens, and make loan repayment more manageable.