Students to Blame for College Debt?
If you want the state action to lower interest on loans, you have to vote.
Money and Student Debt. Image by Paul Ritz.
Under federal law, you cannot refinance your federal student loan with the government.
This is a huge problem for over 800,000 Wisconsinites with over $19 billion in federal student loan debt, locking hundreds of thousands of borrowers into higher than necessary interest rates and costing Wisconsin families.
And, many more borrowers have private loans on which they’re oftentimes paying double-digit interest rates while big banks borrow from the federal government at rates of less than 1% .
In Wisconsin the problem is getting worse, not better. Our state is now the third highest in the nation for the percentage of college graduates with student loan debt. How it has happened is no secret. Since just 2010 we have seen historic cuts to the University of Wisconsin and technical college systems, drastic underfunding of financial aid leaving tens of thousands of eligible students without any help and double digit tuition hikes.
The unfortunate reality of the student loan debt crisis is that borrowers who took on the personal responsibility to pay for it are not being treated fairly by the system. Millions of Americans are being denied the fair shot at the middle class that they earned with their hard work in getting an education.
Common sense reforms like allowing borrowers to refinance their student loans, just like you can with a home or auto loan have been introduced both here in Wisconsin and in Washington D.C. And more and more policymakers are getting on board with the need to reform the system to make sure education remains a path to the middle class.
But politicians like Gov. Scott Walker recently held a press conference to offer “solutions” like a website and telling borrowers to call their bank. Meanwhile every member of the Republican majority in both the Senate and Assembly in 2013 and 2015 voted against a state based plan that would have helped borrowers refinance their student loans.
We need to change the system and it’s clear that means changing the minds of policymakers.
The good news is that together we have the power to do it.
To make these ideas a reality, borrowers need to get educated and get involved. There are 43 million Americans with over $1.3 trillion in student loan debt. By getting educated about where policymakers stand on the issue of reform and by voting we can make the student loan debt crisis the new third rail of American politics — ignore the need for reform, and you’re out.
So get informed, get involved and get out to vote.
Analiese Eicher, Program & Development Director, One Wisconsin Now
“Under federal law, you cannot refinance your federal student loan with the government.”
If this is true, how did my wife refinance her student loans with a private company?
when you focus on a diploma, you get what you pay for. Eat your lumpy farina.
Refinancing a student loan is quite different than a home or auto loan. If I default on either of those, the house or car can be taken as collateral. There is nothing to take from you when you default on a student loan, hence there is a higher risk and a higher interest rate to compensate. I would be in favor of a refinance of student loans if you could sufficiently prove you have a job and are capable of paying it back. Unfortunately those looking to refinance are often doing so b/c they didn’t find a good job and can’t afford their current payments. Regardless, you’re never going to be able to refinance a student loan to the rate of a home or auto loan b/c they are just inherently different.
AND you have to vote for more than just president. In the presidential primaries, far fewer total votes were cast for Wisconsin Supreme Court judge than for president. Walker’s appointee won that contest, even though more votes were cast for a Democratic candidate for president than a Republican one, and more total votes were cast for any presidential candidate than for any state supreme court candidate.
This tells us that a LOT of people just checked off their favorite for president, and left the rest of the ballot blank. It also tells us that if everyone who voted for a Democratic presidential candidate had voted for the Democratic Supreme Court candidate, Kloppenburg would have won and Walker’s far less qualified candidate would have lost.
Vote on the entire ballot in November. We could easily have a Democratic president and still be stuck with Walker’s Republican state legislature if you don’t!