Graduate Success Act
Starting July 1st, student loan borrowers face the potential of adding more than $5,000 to their already onerous federal student loan debt. U.S. Rep. Karen Bass (D-Calif.) introduced the Graduate Success Act to help ease the burden on graduates who are experiencing additional financial hardships due to unemployment.
While the unemployment rate is at its lowest since February 2009, 13 million Americans are still out of work and cannot afford the financial burden of student loan payments. Recent graduates are also entering into one of the worst job markets on record for young people and many find themselves out of work with an average student loan debt of $25,000.
Paying student loan bills while you have a job is difficult enough for many borrowers, and keeping up with payments during a time of unemployment is even harder. Currently, borrowers who have lost their job through no fault of their own may qualify to temporarily postpone monthly payments on federal student loans. However, interest can continue to grow on the loan during the unemployment period sending those with no income further into debt.
Suspending interest on student loans during periods of unemployment will help out of work borrowers pay necessary bills immediately, like rent and utilities, while still allowing borrowers to pay the loan off later. As unemployed borrowers struggle to make ends meet and diligently look for work, legislation is needed to free them from accumulating interest adding to their financial burdens.
The legislation would extend interest-free deferments to unemployed borrowers of unsubsidized federal student loans for up to 3 years. It would also suspend interest during periods of unemployment for borrowers participating in the Income Based Repayment program and borrowers consolidating their loans.
The bill was introduced on June 5, 2012 and was referred to the Education & Workforce Committee. The bill has the support of 39 cosponsors. Sponsor is seeking additional cosponsors. Become a citizen co-sponsor!
- The College Institute for Access and Success (TICAS)
- Young Invincibles
- US PIRG
- US Student Association
- American Association of Collegiate Registrars and Admissions Officers
Add your name to the list of citizens who support this bill by filling in your information below: