CoPIRG calls for passage of student loan borrower protection bill

SB21-057 is in the Senate Education Committee Thursday

CoPIRG

On Thursday, CoPIRG callled on the Senate Education Committee to pass SB21-057, the Private Lenders of Student Loans Acts and Practices bill, sponsored by Senator Winter and Senator Gonzales. The bill expands and builds upon important protections in the Colorado Student Loan Servicers Act.

Danny Katz, executive director of CoPIRG, issued the following statement:   

“Low income students and students at for-profit colleges are more likely than their peers to take out private student loans. Many of these students already struggle to meet their basic needs, such as food, housing, and course materials while they are in college. Some lenders take advantage of these vulnerable students with deceptive marketing practices, higher interest rates, and little flexibility. 

Private loans almost universally require borrowers to have cosigners, so student debt can follow parents and grandparents into retirement with few avenues for cosigner release, even if the borrower makes all of their payments on time. One example of practices that cause significant collateral damage is when private loan companies put borrowers and cosigners into default while they are being evaluated for a new payment plan. This practice can dramatically and negatively impact borrowers’ credit score and their ability to be approved for loans and mortgages in the future. 

By passing this bill, the legislature has the opportunity to extend common-sense consumer protections to Coloradans who took out private student loans to better their families’ future.”