HR0721 93RD GENERAL ASSEMBLY

HR0721 LRB093 21409 LRD 48072 r

HOUSE RESOLUTION

WHEREAS, The level of higher education debt being incurred by students is having a negative effect on their access to postsecondary education, their persistence in attaining that education, their career choices, and their ability to repay their debt after leaving school; and

WHEREAS, In 2002, Illinois schools gave out approximately 85,000 Federal Direct Student Loan Program (FDSLP) loans; and

WHEREAS, In fiscal year 2003, the Illinois Student Assistance Commission (ISAC) guaranteed federal student loans for 89,746 Illinois Stafford borrowers and 7,336 PLUS borrowers; and

WHEREAS, As of August 31, 2003, there were 274,094 borrowers with a student loan guaranteed by ISAC who were in repayment status and 3,696 ISAC borrowers who defaulted and are currently in bankruptcy status; and

WHEREAS, Current repayment options do not provide for manageable monthly payments for some borrowers, which is particularly problematic when borrowers first enter the workforce; and

WHEREAS, Loan consolidation was originally created by the U.S. Congress to simplify the process of loan repayment for borrowers with multiple servicers and to help lower monthly payments for borrowers in difficult financial circumstances; therefore, be it

RESOLVED, BY THE HOUSE OF REPRESENTATIVES OF THE NINETY-THIRD GENERAL ASSEMBLY OF THE STATE OF ILLINOIS, that we urge the U.S. Congress to require that the interest rate calculated on a Federal Direct Loan may not increase more than 2% above the original interest rate for unconsolidated loans; and be it further

RESOLVED, That we urge the U.S. Congress to allow borrowers to refinance their existing consolidated loans; and be it further

RESOLVED, That we urge the U.S. Congress to require (i) that all repayment options for consolidated loans allow, but not mandate, dual or singular payment options in the course of a payment cycle and (ii) that this option be available for electronic or manual payment delivery; and be it further

RESOLVED, That suitable copies of this resolution be delivered to the President pro tempore of the U.S. Senate, the Speaker of the U.S. House of Representatives, and each member of the Illinois congressional delegation.