Las Vegas, Nev. – U.S. Senator Catherine Cortez Masto (D-Nev.) today joined Senator Elizabeth Warren (D-Mass.) in introducing legislation to allow eligible student borrowers to refinance their federal loans and ease their debt burdens. The Bank on Students Emergency Loan Refinancing Act would let borrowers locked in to high interest rates from the past take advantage of the historically low rates current new borrowers are eligible for.
“Nevadans carry tremendous student loan debt—an especially heavy burden to juggle in the middle of the economic fallout of the coronavirus pandemic. This bill would let borrowers paying high rates refinance at around half of their current interest rates, freeing them up to meet other financial obligations, pay down debt faster, or save for further education, a small business, or a home. I will keep working in the Senate to make sure education is affordable and accessible to all Nevadans, and to make sure that school doesn’t lock Nevadans in to decades of crippling debt.”
BACKGROUND:
Senator Cortez Masto has pushed to expand educational opportunities for all Nevadans, giving them access to upward mobility. She was an original cosponsor of the Bank on Students Emergency Loan Refinancing Act of 2017. She has also advocated for pausing student loan payments during the coronavirus pandemic in order to lift the additional burden on borrowers facing financial difficulties during an economic downturn.
The Bank on Students Emergency Loan Refinancing Act of 2020 provides for the following:
- Allows eligible student loan borrowers to refinance their federal loans. This bill would allow student loan borrowers with high interest rates on federal or private loans to refinance them at the current lower interest rate for Federal Direct Stafford Loans and Federal Direct Unsubsidized Stafford Loans.
- Allows eligible student loan borrowers to refinance their private loans into the federal program. The bill provides those who are in good standing the option of refinancing their high-interest private student loans down to the rates offered to new federal student loan borrowers this year. Those who refinance will also have access to the benefits and protections of the federal student loan program. Participation is fully voluntary.
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