Washington, DC -- Congressman Eliot Engel (D-NY-17) is calling for the House Republican Majority to build upon President Obama’s recent Executive Order to assist college graduates in paying off their growing student loans.  The President’s actions come in the absence of Republican leadership activity.

“I applaud President Obama for doing what he can to improve the students’ lives who are struggling with mountains of bills and debt.  However, Executive Orders are limited in power and Congressional action is needed.  Unfortunately, the House Majority has failed to consider legislative assistance to help Americans deal with their student loan debt.  Instead, they have engineered false crises with the federal budget and debt, leading to an unprecedented downgrade of our credit.  So, not only are we not helping our citizens deal with debt, but we are making our country’s debt even worse,” said Rep. Engel.

The President’s plan, called “Pay As You Earn,” helps just under two million low-income new student loan borrowers cap their loan payments at 10 percent of their discretionary income, beginning next year. It would also forgive the balance of their debt after 20 years.  In addition, just under six million borrowers would have the chance to save up to half a percent in interest by consolidating their loans.  This accelerates a plan already voted into law last year.

Borrowers already in default won't qualify. The accelerated component of the income-based repayment plan only applies to borrowers who take out a loan in 2012 or later and who also took out a loan sometime between 2008 and 2012, according to the Education Department. To be eligible for the consolidated loan component, a borrower must have both a direct loan from the government and a loan from the Federal Family Education Loan Program.

The federal government does not have the authority to affect private loans. 

“The Republican Majority needs to work with the Democrats to solve the problems facing our country.  We cannot continue to simply engage in partisan rhetoric.  We need to stop wasting time attacking women’s health and the Environmental Protection Agency, and instead attack the personal debt which is drowning far too many Americans. Meanwhile the best way to help these Americans is to help create jobs, which this Republican Majority has failed to make a priority. Recent college graduates face one of the worst job climates in history.  There is a world of good that we can do for Americans if we would just act together.  It is the right thing to do, and the reason most of us got into public service in the first place,” added Rep. Engel, a 12-term Congressman who has served under four Presidents (two from each party) and under both Democratic and Republican Majorities.

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