Shelley Berkley for Congress

(May 1, 2008 -- Washington, D.C.)  Congresswoman Shelley Berkley (D-NV) praised today’s House passage of legislation that ensures students and families have access to federal student loans.  The Ensuring Continued Access to Federal Student Loans Act of 2008 (H.R. 5715), which carries no new cost for taxpayers, was passed   on a vote of 388 to 21 and now heads to the President’s desk for final approval.

"As a Nevadan who attended UNLV and law school on student loans, I know first hand the importance of making sure that families and students have access to these financial resources,” said Berkley.  “Affordable student loans provide millions of Americans with the chance to attend college when they might not otherwise have the financial resources necessary and that is why we must protect this system.  The adjustments made by this bill will add stability to the student loan market and improve access to these funds so that more Americans can earn their college degrees” said Berkley, a former Nevada University Regent.

The Ensuring Continued Access to Student Loans Act of 2008 (H.R. 5715) provides new protections, in addition to those already in place under current law.  The package will ensure that families continue to have timely, uninterrupted access to federal college loans in the event that the stress in the credit markets leads a significant number of lenders to substantially reduce their activity in the federally guaranteed student loan program.

Major Provisions of H.R. 5715:

    * Reduce borrowers’ reliance on costlier private college loans and encourage responsible borrowing.  Over the course of their education, dependent undergraduate students can currently borrow up to $23,000 in total federal student loans (both subsidized and unsubsidized) and independent undergraduates can borrow up to $46,000 in total loans.

    * Increase the annual loan limits on federal unsubsidized student loans by $2,000 for undergraduate students, and increase the aggregate loan limits (the total loan limit over the course of a student’s education) to $31,000 for dependent undergraduates and to $57,500 for independent undergraduates.

    * Give parent borrowers more time to begin paying off their federal PLUS college loans.  H.R. 5715 would give parents the option to defer repayment until up to six months after their children leave school, giving families more flexibility in hard economic times.

    * Help struggling families pay for college.  Under current law, parents with an adverse credit history are ineligible to receive a parent PLUS loan, except under extenuating circumstances. H.R. 5715 would temporarily classify as an extenuating circumstance delinquencies of up to 180 days on home mortgages and medical debt, thereby making it possible for parents feeling strained by the current housing market and rising medical costs to secure loans for their children.

    * Provide the U.S. Secretary of Education additional tools to safeguard access to student loans.  H.R. 5715 would clarify that existing law gives the U.S. Education Secretary the mandatory authority to advance federal funds to guaranty agencies operating as lenders of last resort in the event that they do not have sufficient capital to originate new loans. The bill would also allow guaranty agencies to carry out the functions of lender of last resort on a school-wide basis.