“Young people are really having trouble moving on with their lives. They are not able to do the things [we] did shortly after graduating because of the debt that they hold as a result of their education.” – Attorney General Ellen Rosenblum, The People’s Lawyer Podcast, 2020
“Many, many millions of students obtain a good education, but they still are saddled with debt. And so, we need to do something to make sure that those students, after they graduate…have the ability to live their lives, buy a house, have a family, get a car, own a business….” – Attorney General Ellen Rosenblum, The People’s Lawyer Podcast, 2020
Most students in Oregon rely on student loans to help pay for their education. The average Oregon student loan borrower owes over $38,000 by the time they graduate. Combined, Oregonians have more than $20.5 billion dollars in student loan debt, with an estimated 85,000 Oregonians who are currently behind on their loans. With student debt numbers this large, it is easy to understand how student loans can easily turn into the obligation of a lifetime.
The Covid-19 pandemic has only made the student debt problem worse. In 2020, as unemployment spiked around the country, 3.2 million students borrowed money for the first time. As a result, the nationwide total student loan debt balance increased 8.28% in 2020. By July of that year, 11.2% of adults with student loan debt reported that they were unable to make a payment.
Oregon’s New Student Loan Laws
Fortunately, Attorneys General play an important role in protecting students, co-signers, and former students from misleading and deceptive student loan practices.
In 2017, Oregon Governor Kate Brown signed into law Attorney General Rosenblum’s bill requiring Oregon colleges and universities to send students annual, easy-to-understand letters explaining the scope of their federal educational debt, including the amount of loans taken out, and what the potential total payment over the life of the loan could be.
In 2021, Attorney General Ellen Rosenblum helped to pass SB 485, a “Student Loan Borrowers Bill of Rights” ». The law addresses many of the problems borrowers experience with student loan servicers, or the companies that service student loans and advise borrowers of their repayment options. Many companies have shown that they do not have the borrowers’ best interests at heart, by steering borrowers toward less favorable repayment options and other harmful practices.
To help address this growing problem, the law creates a student loan ombudsperson to help educate and counsel student loan borrowers, who face complex systems of repayment. It also requires student loan servicers to maintain a license from the Department of Consumer and Business Services which will monitor, and, if necessary, sanction servicers of student loans who engage in fraudulent, deceptive, or dishonest dealing.
“This new law will put tens of thousands of Oregonians on a better and more sustainable path and will hopefully prevent what should be a manageable debt load upon graduating from becoming the obligation of a lifetime for our students.”
-Attorney General Ellen F. Rosenblum, 2021.
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