Empowering Students Through Enhanced Financial Counseling Act

Floor Speech

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Mr. PETERS of Michigan. Madam Chair, I rise today to offer an amendment that builds upon the existing language in this bill to strengthen protections for American students. My amendment ensures students have the information that they need to make important financial decisions that could impact their lives long after graduation.

As you may be aware, combined student loan debt in our Nation has topped $1 trillion, and the unfortunate reality is that many of those students do not know the enormous harm that defaulting on that debt can cause to them. Nearly 15 percent of the student loan borrowers default within 3 years of graduation, and this can have serious consequences on their ability to rent an apartment, to purchase a car or a house, or to even obtain future employment.

Madam Chair, I applaud the spirit of this bipartisan legislation to provide enhanced financial counseling services to our Nation's students, and I look forward to voting in favor of it. My amendment will make a very simple adjustment to ensure the full effectiveness, however, of the bill.

My amendment will simply require that all student borrowers receive an explanation of the impact of a delinquency or of a default on loans to their credit scores, including the borrower's future ability to find employment or to purchase a home or a car. It is important for students to have this information when they first receive the loans. For many recent graduates, the idea of a credit report or a credit score may seem very abstract. My amendment ensures that the impact of delinquencies or defaults are explained in very concrete terms.

Recent graduates are the top in their fields but, all too often, fall behind when it comes to financial literacy, which can have a lasting impact on their lives, and it can also take a toll on our economy. For more than 20 years, I worked as a financial adviser, helping families plan for their futures. It is important that all of our graduates understand how the decisions they make today will affect them and their families down the road when they are finding a job, buying a car, or renting or trying to own a home. We need to promote financial literacy when it can do the most good--before a borrower gets in trouble.

As we continue working to make college more affordable for our students, I believe this legislation and my amendment to it are both commonsense steps in the right direction that we can act on immediately. I look forward to a strong bipartisan vote on this bill, and I hope the Senate takes up this important legislation in a timely manner. I urge my colleagues to join me in the support of this amendment.

I yield back the balance of my time.

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