Gov. Ralph Northam visited Newport News last Friday, June 22 and signed a bill that creates an office for Virginia borrowers struggling to repay student loans.
Del. Marcia ‘Cia’ Price, D-Newport News sponsored the bill Northam recently signed into law at the Boys and Girls Club, at 429 Thornhill Dr., in Newport News. On the campaign trail, Northam and Price pledged to provide student loan relief. In February, the Senate and House each passed bills to create the Office of the Qualified Education Loan Ombudsman within the State Council of Higher Education for Virginia. Northam approved the legislation on April 4.
Before Northam signed the bill into law, he told the small audience that there are about 1 million student loan borrowers in the state who are paying back a total $30 billion. He said a strong economy depends on people who can get the skills they need.
“So we just want to make sure we can continue to encourage individuals to go to our colleges … the less debt people have, the better,” Northam said.
Specifically, the Ombudsman will protect consumers from unfair debt collection practices and help them understand their repayment options. In recent years, a growing number of states, including Connecticut, Illinois, and the District of Columbia, have established such officers. The Ombudsman will strive to help borrowers by renegotiating loan terms, asking servicers to delay payments, and helping borrowers enter careers where student loan forgiveness is an option, such as in public service.
After HB 1138 was passed in February, Price, the bill’s sponsor told the Associated Press, “Too many student borrowers sign their names on the dotted line at only 18 or 19 years old.
without fully comprehending their rights and responsibilities associated with that debt, but also knowing that without those loans they would not be able to earn their degrees.”
State officials said more than 1 million Virginians owed more than $30 billion in student loan debt, in 2017. Nationally, student loan debt is more than $1.3 trillion and climbing.
“Virginians owe more on student loans than we do on credit cards or car loans, but only student loans lack consumer protections,” Anna Scholl, executive director of Progress Virginia, a liberal advocacy group, said when the ombudsman bill was first announced. “Student loan borrowers should be treated just like everyone else and afforded basic protections to ensure the cost of education doesn’t ruin their financial future.”