President Obama announced and signed a so-called “Student Aid Bill of Rights” Tuesday, along with a series a executive actions he plans to take on student loans.
“It’s an executive action that we’re able to take to streamline and improve the manner in which the federal government interacts with students,” Obama told reporters in the Oval Office before signing the memorandum.
– Every student deserves access to a quality, affordable education at a college that’s cutting costs and increasing learning.
– Every student should be able to access the resources needed to pay for college.
– Every borrower has the right to an affordable repayment plan.
– And every borrower has the right to quality customer service, reliable information, and fair treatment, even if they struggle to repay their loans.
The new “Bill of Rights” also comes with a set of directives and plans for the next couple of years.
These include a couple of new online programs. Obama will direct the U.S. Department of Education to create a new online feedback system by July 2016 that allows students and borrowers to file complaints about federal student loan lenders, servicers, collection agencies and colleges and universities.
The DOE will also create a website where borrowers can access their account and payment information, no matter which loan servicer has been assigned to their account. Right now borrowers have to visit the websites of the outside companies.
Other directives focus on the lenders, requiring them to provide better customer service and create more repayment options.
Obama also plans to coordinate with the DOE to launch a two-year pilot program in which the federal government will directly collect the defaulted debt of a small number of loan borrowers. Right now, all of these defaulted loans are collected by private contractors.
As the White House mentioned in its fact sheet on this initiative, “Americans are increasingly reliant on student loans to help pay for college. Today, more than 70 percent of those earning a bachelor’s degree graduate with debt, which averages $28,400 at public and non-profit colleges.”
But while the new “Bill of Rights” comes from the right place, it still ignores the root of the problem — the cost of college. By only placing a bandaid on federal student loans and getting even more involved in the debt collection process, it seems unlikely that students will see a real change.
Obama signed a memorandum declaring the bill of rights and new directives before leaving for Atlanta, where he will discuss student loans in an afternoon speech at Georgia Tech, according to his schedule.
