Legislation expanding consumer protections for Washington’s 800,000 student loan borrowers is headed to the governor’s desk after passing the state House of Representatives with overwhelming bipartisan support on Friday.
“After three years of working on this bill, I am thankful to my colleagues in the Legislature for putting people first and standing with the hundreds of thousands of Washingtonians who are trying to manage their student loan debt,” said Sen. Marko Liias, D-21st District, and sponsor of the bill. “For more and more living wage jobs in our state, higher education has become a basic requirement, but the rising costs of a degree are having a real impact on hard working Washingtonians. This bill is a significant first step, giving borrowers the best tools and information they need to pay off their loans.”
Senate Bill 6029, known as the Student Loan Bill of Rights, will increase oversight for student loan servicers who operate in the state of Washington. It will also create a Student Education Loan Advocate that will be responsible for fielding complaints from student borrowers and helping borrowers better understand their rights and responsibilities under their loan agreement.
According to the state Attorney General’s office, hundreds of complaints have been filed against student loan servicing companies and third-party loan modification companies over questionable operating procedures and debt readjustment scams that prey on students struggling to make their loan payments.
As of 2016, Washingtonians collectively owe more than $24 billion in student loans. They are part of the 44 million Americans who now owe more than $1.48 trillion in student loan debt, more than the total national credit card debt.
Nationally, one in four student loan borrowers are behind in payments. As incomes have stagnated and many states have reduced investments in public higher education, the need for these loans has continued to rise. This rapidly growing debt jeopardizes livelihoods, relationships, and even retirement.