Rep. Susan Davis (D-CA) on Monday introduced two bills to provide student loan borrowers relief, including one that would eliminate origination fees.
Davis, a senior member of the House Committee on Education and the Workforce, introduced the Eliminating the Hidden Student Loan Tax Act, which would eliminate all administrative fees on federal student loans. The fees, also called origination fees, can range from one to four percent and are considered by many to be a tax on student loans. NASFAA has long called for the elimination of such fees.
The second bill Davis introduced, the Student Loan Fair Prepayment Act, would ensure that extra student loan payments are applied first to the principal of the highest interest-rate loan, unless the borrower requests otherwise. According to a press release from Davis's office, the technical change would save student loan borrowers money and help them pay off their debts faster.
“The debt saddling students when they leave college hurts not only the students but impacts our economy,” Davis said in a statement. “Federal student loans are an investment in our nation’s future. We need to be sure we are getting a good return on that investment by ensuring graduates can contribute to the economy when they leave college.”
Publication Date: 9/28/2017