Press Release  AG Healey Calls on U.S. Secretary of Education to Further Address Student Loan Crisis

BOSTON — Attorney General Maura Healey today joined a coalition of 23 attorneys general in sending a letter to the U.S. Secretary of Education Dr. Miguel Cardona calling for reforms that would enable borrowers to better navigate student loan repayment and protect borrowers from debts incurred attending predatory for-profit and defunct colleges.

“The U.S Department of Education has the authority to take meaningful and immediate action to help struggling student borrowers, especially as we recover from the economic crisis created by the COVID-19 pandemic,” said AG Healey. “We are calling on Secretary Cardona to pursue reforms and work with states to ease the crushing burden of student loan debt for tens of millions of Americans and their families.”

In their letter, the attorneys general urged Secretary Cardona to consider several policy actions that would help student loan borrowers, including:

• Continuing the policy of suspending student loan payments, waiving interest, and halting involuntary collection activities for as long as necessary to support struggling borrowers;
• Expanding these pandemic protections to all federal loan borrowers, including borrowers whose federal loans are owned by private lenders;
• Delaying income-driven repayment (IDR) plan recertification deadlines by at least one year once the pandemic protections end and payment obligations resume;
• Enacting reforms so that student loan borrowers are more readily able to access and remain in IDR plans that offer more affordable monthly payments, potential interest subsidies, the possibility of loan forgiveness, and which help borrowers avoid the devastating consequences of default;
• Improving the implementation of the Public Service Loan Forgiveness program, including providing borrowers more information about denial rationales and offering a clear, easy-to-navigate appeal process;
• Enforcing the gainful employment requirement of the Higher Education Act, which shields borrowers from for-profit programs that fail to prepare students for careers; and
• Enacting robust borrower defense rules to protect borrowers from predatory for-profit schools, including allowing for group submissions by state attorneys general and implementing automatic closed school discharge.  

The letter applauded the Department’s March 30 actions to expand pandemic protections to privately-owned loans. The attorneys general also welcomed President Biden’s commitment to consider using executive authority to cancel student debt, saying “...we strongly urge that any debt cancellation should apply to all federal loans – including Federal Family Education Loans and Perkins loans that are not owned by the Department...For many with student debt, the current system is highly complex and difficult to manage. This is a needless source of great anxiety and is plainly unfair. We can and must do better.”

The letter was also signed by the attorneys general of Pennsylvania, Colorado, California, Connecticut, District of Columbia, Delaware, Hawaii, Iowa, Illinois, Maryland, Maine, Minnesota, North Carolina, New Jersey, New Mexico, New York, Nevada, Oregon, Virginia, Vermont, Washington and Wisconsin.

Handling this matter for Massachusetts is Deputy Director Arwen Thoman and Chief Glenn Kaplan of AG Healey’s Insurance and Financial Services Division.

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