WASHINGTON — U.S. Senators Ben Cardin and Barbara A. Mikulski (both D-Md.) today became original cosponsors of the Bank on Students Emergency Loan Refinancing Act. Introduced by Senator Elizabeth Warren (D-Mass.), the legislation would allow those with outstanding student loan debt to refinance at the interest rates that were approved last year for new borrowers. A previous version of the bill was voted on in the 113th Congress, and every Senate Democrat and three Senate Republicans voted to move the bill forward, falling just short of breaking a Republican filibuster.
“How can we allow Americans buying high-end luxury items to refinance loans after rates drop, but not allow students to refinance their high-rate loans for college?” said Senator Cardin, a member of the Finance Committee. “The federal government should be responsible for ensuring all Americans have a fair shot at success, not be in the business of turning profits off of student loans. This commonsense legislation ensures that at a time of intense global competition we are not pricing American students out of a higher education.”
“Middle class families need a raise and more money in the family checkbook. That means a fair shot at affordable higher education to help them climb the rungs of America’s opportunity ladder,” said Senator Mikulski, a senior member of the Senate Health, Education, Labor and Pensions (HELP) Committee. “Right now, millions of American students are graduating from college and universities but as they are handed their diplomas, they are being handed a lifetime of debt. Getting a college education is the core of the American dream. I will continue to fight so Maryland families have access to that dream with a fair shot at higher education and a government on their side.”
Many borrowers with outstanding student loans have interest rates of nearly 7 percent or higher for undergraduate loans, while students who took out loans in the 2013-2014 school year pay a rate of 3.86 percent under the Bipartisan Student Loan Certainty Act passed by Congress in 2013. The Bank on Students Emergency Loan Refinancing Act would allow our students and young people to pay back their outstanding loans at the same rates that Democrats and Republicans in the House and Senate embraced last Congress as the appropriate rates for new borrowers. In the last Congress, the Bank on Students Emergency Loan Refinancing Act received dozens of endorsements from higher education organizations.
As an advocate for the Bank on Students Emergency Loan Refinancing Act, Senator Cardin has held roundtable discussions on college affordability with students and administrators at University of Maryland Baltimore County, Bowie State University, Towson University in North East Maryland, Anne Arundel Community College, Community College of Baltimore County, Dundalk, and The College of Southern Maryland. Senator Cardin continues to travel across the state meeting with students and families exploring the many challenges Marylanders face in paying for higher education.
Over the past year, Senator Mikulski has embarked on a Maryland College Affordability Tour, meeting with students, administrators and teachers to discuss the many challenges students and families face in paying for higher education, along with the impact on jobs and communities. In her roles on the HELP and Appropriations Committees, Senator Mikulski has been an advocate for access to quality higher education through programs like the federal Pell Grants program, which provides need-based grants to lower-income undergraduate students to obtain access to higher education. As Chairwoman of the Appropriations Committee, Senator Mikulski worked to ensure that the fiscal year (FY) 2015 government spending bill supported a maximum Pell Grant award of $5,830. Pell Grants help nearly 8.8 million college students across the country, including more than 112,000 Maryland students access higher education and can be used to pay for tuition, fees, books and living expenses.
The General Accountability Office estimates that the federal government will make $66 billion dollars on student loans issued from 2007-2012. In the 113th Congress, Senator Cardin also cosponsored the Understanding the True Cost of College Act (S.1156) which would have helped make the cost of college more transparent from the outset by standardizing financial aid, forms and definitions.
In Maryland, nearly 60 percent of students in the graduating class of 2013 borrowed to pay for their education and accumulated an average total debt of $26,350.