Maine is the latest state to pass a law amid frustration with federal inaction over the supervision of student loan companies.
On Thursday, Maine Governor Janet Mills signed the “Act To Establish a Student Loan Bill of Rights To License and Regulate Student Loan Servicers,” which will go into effect in September.
“Paying back student loan debt is difficult enough without a profit-hungry lender trying to make it harder and more expensive,” Governor Mills said in a statement. “By signing this bill into law, Maine is taking critical action to create oversight, implement accountability, and protect the interests of our borrowers.”
The legislation follows similar actions taken by about a dozen states, including Connecticut and Illinois, and reveals a strategy where lawmakers on the state level are taking political action to address the student debt crisis that arose from years of lax oversight and predatory loan servicers.
“There are talks of federal legislation that would lessen the need for states to act,” D.C.-based nonprofit Generation Progress’ Charlotte Hancock told Yahoo Finance. “But in the interim and in with the [Education Secretary Betsy] DeVos deregulation agenda firmly in place… state legislators are taking matters into their own hands to do something about the problems they’re hearing about over and over again from their constituents.”
States holding student loan servicers accountable
The states’ actions come amid a student debt crisis where about 45 million borrowers across the U.S. hold nearly $1.5 trillion in outstanding loans.
Citing the lack of action taken by the Department of Education and the Consumer Financial Protection Bureau in regulating and supervising companies like Navient and Nelnet, states from California to Connecticut — and now Maine — have been pushing for increased protections for student loan borrowers, just like those that mortgage and credit card borrowers enjoy.
Maine’s bill in particular will establish a student loan ombudsman who will review and possibly resolve complaints from borrowers, a superintendent who will supervise the loan servicers, and will also formalize a list of “prohibited acts” for the companies.
There they are again, those 3 words: Bill of Rights. Second time this week I’ve seen them used out their original place, their original intention. Is this an attempt to dilute or corrupt original meaning? One is protective of that which is inalienable, and “Licensing and Regulating,” do not seem inalienable to me.
The 3 words are only what they are and none should steal them. I hope I’m seeing this right.
.
Misdirection.
https://youtu.be/kx3sOqW5zj4?t=2