July 23, 2019

Bonamici, Mitchell, Moulton, Fitzpatrick Introduce Bipartisan Bill to Help Student Loan Borrowers Avoid Default

Legislation automatically connects student loan borrowers with income-driven repayment plans


WASHINGTON –  Representative Seth Moulton (D-MA) joined Reps. Suzanne Bonamici (D-OR), Paul Mitchell (R-MI), and Brian Fitzpatrick (R-PA) to introduce legislation to help student loan borrowers avoid default.


The bipartisan SIMPLE Act, H.R. 3833, will reduce student loan defaults by connecting struggling borrowers with income-driven repayment plans so they can repay based on financial ability. The full name of the legislation is the Streamlining Income-driven, Manageable Payments on Loans for Education (SIMPLE) Act.


The SIMPLE Act protects some of the most vulnerable student loan borrowers—those who can’t afford full loan payments, those who are in immediate danger of default, those who have previously defaulted on their debt, and those who are totally and permanently disabled—from the severe consequences of default. The bill uses information already on file at the U.S. Treasury to connect borrowers automatically with existing protections, including affordable monthly loan payments based on their income. The legislation also automates the annual process for updating income information while enrolled in these plans, further removing risk of default.


“Too many people are struggling to make payments on burdensome student loans even though there are federal programs available to help,” said Congresswoman Suzanne Bonamici, Chair of the Education & Labor Subcommittee on Civil Rights and Human Services. “The bipartisan SIMPLE Act will streamline the enrollment process for income-driven repayment plans, making it easier for borrowers to access affordable payments and avoid the catastrophic effects of default. This legislation is an important step to support those who have invested their time and resources in bettering their future through education.”


“When you graduate college and take that first job and are making so little you can barely make rent and keep the lights on, your student loan repayment should reflect that. This bill will get the  government working for young Americans and especially first-generation college graduates to help them avoid bankruptcy, which is good for them and even better for our economy," said Congressman Seth Moulton.


“We must make it easier for vulnerable student loan borrowers to avoid default,” said Congressman Paul Mitchell. “We already have systems in place that allow borrowers to enroll in income-driven repayment plans that meet their needs, however the process for enrolling in these plans can be overly burdensome and confusing. The bipartisan SIMPLE Act will streamline the process for borrowers to access these plans, protect them from paying more than they can afford, and help them avoid default.”


“Student loan defaults have damaging consequences for borrowers that can last a significant period of time,” said Congressman Brian Fitzpatrick. “An investment in one’s education should not lead to long-term financial distress, and borrowers deserve more efficient access to the tools already at their disposal under the law.”


Borrowers who owe less than $10,000 are more likely to default than borrowers with six-figure debts.


You can read a summary of the SIMPLE Act here and the full text of the bill here.