Citing mounting debt as a problem for students pursuing a college degree, President Barack Obama signed an executive memorandum Tuesday calling for a “Student Aid Bill of Rights.”
The action establishes a complaint system for student borrowers with the Department of Education to be set up by July 2016; takes steps to help students pay back their loans and analyzes student debt trends to suggest legislative and regulatory changes. The Obama administration will also release state-by-state data showing how many borrowers stand to benefit from the changes.
Obama said he wanted to ensure “every young person in this country who is willing to put in the effort can afford to go to college.”
“As part of that overall process, today we’re going to be talking today about a student bill of rights,” Obama said. “This is part of it. 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.”
The four “rights” under the memorandum are: “Every student should have access to a quality, affordable education at a college seeking new ways to lower costs and increase learning”; that “every student should be able to access the resources needed to pay for college”; that “every borrower has the right to an affordable repayment plan”; and that “every borrower has the right to quality customer service, reliable information, and fair treatment, even if they struggle to repay their loans.”
More than 70 percent of those earning a four-year degree graduate with debt that averages $28,400, according to the White House.
The Department of Education will work in coordination with the Consumer Financial Protection Bureau for increased disclosure and consumer protection requirements in student lending, and “raise standards” for debt collectors to provide “fair treatment” to borrowers, a White House press release said. The Department of Treasury will be involved in enrolling borrowers into “income-driven repayment plans,” the White House said.
The White House says that much progress has already been made on the Student Aid Bill of Rights, going back to the changes that Obama made in the student loan system and increased Pell Grants.