National Defense Authorization Act for Fiscal Year 2022

Floor Speech

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Ms. DEAN. Madam Speaker, I rise today in support of my amendment, which would require private student lenders to discharge private student loan debt for people who become totally or permanently disabled.

This amendment was inspired by a constituent who came to our office in need. Like many young Americans, my constituent pursued an education and chose to use private loans to help fund her college costs. She was also fully prepared to repay her loans, but tragically she became permanently and totally disabled.

Because of her permanent disability, her mother must now take care of her for life, and not only is the mother her caretaker, she is also the cosigner obligated to carry and pay for this debilitating debt.

Though the student's particular lender allowed her debt to be discharged, her mother, who cosigned the loan, was not dismissed from that responsibility. Though this reality may be foreign to many of us, for those it does affect, it will change their lives forever.

That is why this amendment would right a wrong and bring parity between protections for private student loan borrowers and Federal student loan borrowers.

Currently, private student lenders are not required to discharge the obligation of a borrower who becomes permanently disabled, only in the case of death. However, for Federal student loans in the case of permanent disability or death, loans are discharged.

In addition, Federal student loans do not require cosigners.

Specifically, my amendment amends the Truth in Lending Act to require discharge of private student loans in the case of permanent or total disability of the borrower; require the discharge of cosigners in the case of the borrower's permanent or total disability; require private lenders to discharge a borrower's obligation when they are notified that the Federal Government has discharged the Federal student loans of the borrower.

As we debate the National Defense Authorization Act, it is important to highlight that our servicemembers are disproportionately using private student loans. And these veterans who use private student loans disproportionately use them to attend for-profit universities or institutions. In some instances, veterans leave with nearly double the amount of debt compared to their counterparts who use Federal veterans' education benefits.

Our veterans, our servicemembers, along with all of our constituents, deserve to be protected in the case of unexpected hardship.

I am pleased that in August, the Biden administration announced it would automatically cancel Federal student loan debt through the Total and Permanent Disability Discharge program. The TPD Discharge program provides loan discharge for the borrower and the cosigner should the borrower become totally and permanently disabled.

This is a first step in providing 323,000 Federal student loan borrowers with disabilities the relief they are entitled to under the law.

It is our responsibility to codify and extend this same needed support to our private student loan borrowers and their families affected with these tragedies.

I pray no one go through what my constituents have gone through.

We must move this commonsense and important amendment forward, and I urge all members to support it.

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Ms. DEAN. Madam Speaker, I thank the gentleman for wanting to work with me on this. Certainly this is a serious problem, and it is a serious problem for my constituent, and I am sure constituents in any other district in our country.

But there is a misstatement in the gentleman's words. It is voluntary right now on the part of the private lenders, and this bill would codify the requirement to ensure that disability discharge for private student loans is not a choice.

Certainly, when you sign up for a loan, you don't think about planning for becoming totally disabled and unable to afford your own student loans.

Unfortunately, as my constituent case shows, some private lenders do not voluntarily discharge for the borrower and the cosponsor in the case of permanent and total disability. I believe we have a duty to stand up for the most vulnerable among us. This bill would help accomplish that goal.

I commend the lenders who do step up voluntarily, but we need to codify this discharge of liability in the case of total or permanent disability.

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Ms. DEAN. Madam Speaker, of course there is a clear nexus to our veterans and our servicemembers, and it would be marvelous if all private student loan lenders would voluntarily discharge in the case of permanent or total disability. It just simply isn't the case.

We are trying to ensure parity, regardless of who the borrower owes. We don't believe this would be a difficulty for all of these lenders who you say are willing to do this.

If the lenders honestly want to fight this so that they can take every last dollar of the individuals and their families despite their suffering, they can go to court, and they can ask the court for a remedy.

I urge support, and I yield back the balance of my time.

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