Rep. Zeldin Hosts Press Conference on His Bill Addressing Student Loan Debt Crisis
Washington, DC –Congressman Lee Zeldin (R, C – NY-1) hosted a press conference today at Long Island University (LIU) in Riverhead to discuss legislation he introduced in Congress, The Earnings Contingent Education Loans (ExCEL) Act of 2015 (H.R.3695); and urge Congress to act swiftly to pass this critical legislation that would address the growing student loan debt crisis.
The current student loan repayment model can be overwhelming and burdensome for many borrowers. The ExCEL Act will simplify the process by establishing an affordable, income-based repayment method that is molded to each individual’s needs. Through this process, students would have their loan payments withheld from their paychecks and allow borrowers to repay their loans in timetables specific to their financial needs. The monthly obligation of each borrower only marginally increases when a borrower’s salary increases, ensuring the incentive to pursue higher paying jobs is not eliminated based on fear of huge increases in student loan payments.
A 2013 Consumer Financial Protection Bureau report stated that nearly 1/3 of federal borrowers have either defaulted on student debt, or are in the deferment or forbearance process. Further, the Department of Education recently stated that nearly 12 percent of borrowers have defaulted on loan repayments from 2013 to 2015. Right now, the U.S. Government has almost $800 billion in student loans outstanding on its balance sheet; and according to the nonpartisan Congressional Budget Office, due to the dangerously high rate of default, the government is expected to lose nearly $20 billion over the next 10 years. The ExCEL Act will lower the cost of student loans to the American taxpayer by dramatically decreasing default rates. The legislation contains specific prohibitions that guarantee each borrower meets his or her full financial obligation, and ensures the solvency of student loan assistance for years to come.
Congressman Lee Zeldin said, “I am proud to introduce the ExCEL Act in the House of Representatives to help address the student debt crisis faced by the American public, a serious and growing problem in the United States. Estimates show that currently 40 million Americans have student debt totaling over $1.2 trillion. Young college graduates are having difficulty securing structured loans that can help them afford to get their professional lives off the ground successfully. Under the current system, borrowers are limited to rigid mortgage-like repayment systems which offer little flexibility in terms of repayment. The ExCEL Act would replace the current broken student loan system with an individualized loan repayment program tailored to each student's needs. Borrowers would be able to pay their loans off quicker as they earn more money, but this new system would also provide additional protections for borrowers during periods of low income levels or even unemployment. This flexible repayment approach focuses on the student’s ability to repay loans based on their income to ensure the student is not being set up to fail, while establishing a program that ensures loans are paid back in their entirety, and incentivizes graduates to repay their loans more quickly. We should do all that we can to help younger Americans achieve their full potential as future leaders of this great country. That goal can not materialize when new college graduates are saddled with excessive volumes of debt. The ExCEL Act must be signed into law as soon as possible so we can take the necessary steps to address this growing crisis.”
LIU Dean Donna Di Donato, said, "All of us at LIU are here because we believe in the transformative power of higher education, and this commitment to our students includes making a college education accessible to students from all walks of life."
“I applaud Congressman Zeldin for focusing on the growing student loan debt crisis. I have worked very hard to enact measures ranging from loan forgiveness to increased tuition assistance recognizing that student loan debt is one of the most serious financial issues facing our young people today. I look forward to working with Congressman Zeldin in an effort to further ease the burden on New York Students,” said New York State Senator Ken LaValle.
“Unmanageable student debt not only weighs down young people just starting out in life, but it is detrimental to local economies,” stated Suffolk County Legislator Al Krupski. “In light of this issue, most students today have little choice but to consider the ramifications of taking on such long-term debt in their young lives. Congressman Zeldin’s bill is a positive step in addressing the student debt crisis and one which will make repayment of student loans more manageable for many individuals. I thank him for his leadership on this issue.”
A copy of the bill can be found here.