August 6, 2020 – Tamuning, Guam- Attorney General Leevin Taitano Camacho has joined a bipartisan coalition of 31 attorneys general urging the U.S. Senate to provide relief for all federal student loan borrowers impacted by the COVID-19 pandemic. The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides relief only to student loans owned by the federal government, excluding nearly 8 million borrowers whose federal student loans are owned by private entities. This relief is set to end on September 30, 2020.
From 2016 to 2019, thousands of students at the University of Guam received over $18.4 million in direct loans from the federal government.
“The economic hardship of those with student loan debt is not limited to people whose loans are owned by the federal government,” said Attorney General Camacho. “That is why we are calling on Congress to ensure that all federal student loan borrowers receive relief and to consider long term solutions for those living with student debt.”
In March 2020, Congress passed the CARES Act, which provides financial relief for Americans impacted by the global pandemic, including student loan borrowers. Under the CARES Act, student loan borrowers do not have to make payments and interest will not accrue on their loans through Sept. 30, 2020. The CARES Act also suspends involuntary collection activities and negative credit reporting through Sept. 30, 2020. While this relief is critical, the student loan protections in the CARES Act only apply to federal student loans held by the federal government.
Nationally, nearly 8 million federal student loan borrowers have Perkins loans that are held by schools, or Federal Family Education Loan Program (FFEL) loans that are held by financial institutions. While the federal government supports or guarantees these loans against default, borrowers were denied CARES Act relief. These borrowers do not have relief options under the CARES Act solely because of the entity that owns their loan.
The coalition urges the Senate to provide the same relief currently available to borrowers whose federal student loans are owned by the federal government, including a temporary suspension of payments, a zero percent interest rate, and the suspension of involuntary collections. The coalition also calls for the relief measures to apply retroactively. In addition, recognizing that the effects of the pandemic will be long-lasting, the Attorneys General called on Congress to implement longer-term solutions for struggling borrowers.
Such measures include extending the temporary suspension of payments past Sept. 30, 2020 and requiring student loan servicers to evaluate borrowers for income-driven repayment plans once they resume payments.
Student borrowers who have questions or are in need of assistance can reach the Consumer Protection Division of the Office of the Attorney General at email@example.com or call 475-3324 ext. 3300.
Attorney General Kwame Raoul and Alaska Attorney General Kevin Clarkson led the coalition and are joined by attorneys general of California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Idaho, Iowa, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nebraska, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, Rhode Island, Vermont, the U.S. Virgin Islands, Virginia, Washington and Wisconsin.