The National Consumer Law Center, on behalf of its low-income clients, submits this comment in response to the Department of Education’s announcement of intent to establish two negotiated rulemaking committees (RISE and AHEAD) to make changes to federal student aid programs authorized under Title IV of the Higher Education Act (HEA) of 1965, as amended. Our comments offer detailed recommendations to the Department of Education to improve how the federal student loan program works for students from low-income families.
RISE rulemaking:
As the Department works to implement changes to the student loan repayment, deferment, forbearance, and rehabilitation regulations required by the One Big Beautiful Bill Act, we urge the Department to look for opportunities to improve outcomes for low-income people managing student loan debt. Regulatory reforms can make it easier for borrowers to access and maintain enrollment in income-driven repayment plans, successfully navigate repayment options, avoid financial devastation from default, and get out of default and back into good standing. With more than 20 million borrowers currently in forbearance or other nonpayment status and nearly one in four of those who are required to make payments behind, the Department should take every opportunity to improve repayment success and reduce delinquencies and defaults. In our comments, we offer specific recommendations towards those ends.
AHEAD rulemaking:
Low-performing schools have a long history of disproportionately enrolling low-income students and saddling them with debt they will be unlikely to be able to repay. It is important that the Department restrict access to programs where the graduates will not earn enough to repay their loans. It is also important that the Department take steps to increase programmatic transparency about completers’ post-graduate earnings and debt-to-income ratios of all programs that receive federal student aid funding so that students have a full picture of what loan repayment could look like before they enroll or take out loans.
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