Scanlon, Omar Introduce Student Borrower Advocate Act
Today, Representatives Mary Gay Scanlon (PA-5) and Ilhan Omar (MN-5) introduced the Student Borrower Advocate Act – a plan to transform the Federal Student Aid Office’s Ombudsman into the Office of the Borrower Advocate.
Over 45 million Americans currently have a federal student loan, including one-third of all young adults. For most people, student loans have become the largest monthly expense, outpacing that of a home mortgage and often leading to financial hardship.
“Borrowers currently lack a strong, single-point-of-contact to help them when they have problems with the private companies that service their loans on behalf of the government,” Representative Scanlon said. “This creates opportunity for both confusion and mistreatment, and our students deserve better. The cost of college degree should not be a debt sentence. I am proud to introduce this bill alongside Rep. Omar as we fight to protect the rights of student borrowers.”
The Student Borrower Advocate Act transforms the Federal Student Aid (FSA) Office’s Ombudsman into the Office of the Borrower Advocate. Additionally, it creates a Head Borrower Advocate at the Department of Education who can address borrower’s complaints and concerns regarding their loan servicers.
“There are over 45 million Americans shackled with student loan debt,” Representative Omar said. “The Federal Student Aid Office oversees the $1.5 trillion student loan portfolio and is one of the biggest banks in the country. Transforming the Federal Student Aid’s ombudsman into the role of a Borrower Advocate ensures that this office operates as effectively and efficiently as possible in order to protect students from for-profit colleges and help them navigate the complexities of the federal lending structure.”
In cooperation with the Consumer Financial Protection Bureau’s Private Student Loan Ombudsman, this Office can lend a voice to borrowers and increase transparency and accountability within the Federal Student Aid programs. By elevating the importance of this office and focusing its intent on helping borrowers, it will be better suited to address borrower complaints and concerns.
A copy of the bill can be viewed here.