Student Loan Related

Unlikely Pair of Senators Try to Do Something Reasonable on Student Loans

Written by Steve Rhode

Senators Marco Rubio and Elizabeth Warren introduced a new bill in Congress that would stop the insanity of suspending professional licenses over unpaid federal student loan debt.

At least 20 states have laws on the books that make it harder for people to earn money from their professional license fields if they are struggling and fall behind on their federal student loan debt. I know, it’s insane.

In fact, in Florida licensed health professionals not only have their licenses suspended but have to pay a 10 percent fine on top of that.

“For purposes of this section, failing to repay a student loan issued or guaranteed by the state or the Federal Government in accordance with the terms of the loan or failing to comply with service scholarship obligations shall be considered a failure to perform a statutory or legal obligation, and the minimum disciplinary action imposed shall be a suspension of the license until new payment terms are agreed upon or the scholarship obligation is resumed, followed by probation for the duration of the student loan or remaining scholarship obligation period, and a fine equal to 10 percent of the defaulted loan amount.” – Source

While Senator Rubio once voted to uphold such a ridiculous law in Florida when he was part of the legislature there, he now says he was wrong to do so. And he has significantly changed his tune as well.

“Difficulty repaying a student loan debt should not threaten a graduate’s job. It makes no sense to revoke a professional license from someone who is trying to pay their student loans,” said Rubio. “Our bill would fix this ‘catch-22’ and ensure that borrowers are able to continue working to pay off their loans.”

“State governments punishing people struggling with student loans by taking away drivers’ and professional licenses is wrong. These policies don’t make sense, because they make it even harder for people to put food on the table and get out of debt,” said Senator Warren.

The proposed legislation is called the “Protecting JOBs Act.” If voted into law, beginning two years later, this legislation would prevent states from suspending, revoking or denying state professional licenses solely because borrowers are behind on their federal student loan payments.

Since the bill does not alter or change the way the federal government collects on defaulted debts, we can only hope the Department of Education will not hinder the consideration and passage of this common-sense legislation.




About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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