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New Report on Student Loan Debt in Virginia: Over 1 Million Borrowers Owe $41.3 Billion in Outstanding Student Debt

Time to pass "Student Loan Borrowers’ Bill of Rights"

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See below for a new report – by a coalition of groups, including Progress Virginia and the Virginia Poverty Law Center – on student loan in Virginia. A few highlights include:

  • There are 1.04 million student borrowers across Virginia, with an average student loan balance of $40,457 and a total of $41.3 billion in outstanding student debt.
  • Over the past decade, “student debt in Virginia grew by
    144.7 percent compared to 120.6 percent nationally. This debt burden impacts neighborhoods and communities across the
    state, as student debt stymies economic mobility and wealth accumulation.”
  • “For a 26-year-old Virginian owing $40,000 in student debt, homeownership is delayed by ten years. “
  • “According to the Federal Reserve, student loan borrowers are less likely to remain in rural areas, and adults with the highest student loan balances are the most likely to migrate to
    cities. This impacts critical professions across rural communities, like farming and health care.”
  • “Student debt has been deemed both a “cause and consequence” of racial inequality. Borrowers of color take on more debt to obtain higher education and disproportionately
    struggle during repayment. In fact, African American borrowers default at five times the rate of their white peers”

In sum, this is clearly a huge problem that needs to be dealt with. The question is, how exactly. According to Progress Virginia, the answer is: “passage of HB10 [Del. Marcus Simon] and SB77 [Sen. Janet Howell], the Student Loan Borrowers’ Bill of Rights. This legislation would extend basic consumer protections to borrowers and require loan servicers to be licensed by the Bureau of Financial Institutions, like similar financial providers including banks, credit unions, mortgage lenders, and payday lenders. Servicers would also be required to give borrowers accurate information about their loans, apply payments properly, and report accurate payment information to credit bureaus.”