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YI Testifies: Private Student Loan Borrowers Need Help Now

By Nicholas Kelly

Yesterday, Young Invincibles testified before the United States Senate Committee on Banking, Housing, and Urban Affairs as an advocate for the millions of American student borrowers who currently hold $150 billion in private student loansYI Deputy Director Jen Mishory gave her testimony on behalf of the borrowers who were willing to share their DirksenSenateOfficeBuildingfrustrating and often times heartbreaking stories with YI. Jen related to the committee the story of Bridgette, a young woman whose future is being held hostage by her private lender until she immediately coughs up $27,000.

Entering the Peace Corps after her graduation, Bridgette was able to receive a deferment on her federal loans, but not on her $46,000 in private loans. Her mother assumed the burden of repayment while she was out of the country, but a few months before Bridgette’s return to the United States in 2009, her grandfather passed away and her mother missed two payments. After that, the loans were charged-off and the entire amount became due.

Although Bridgette has been making $300 payments every month for the last three years (despite the fact that nothing relating to repayment has been put into writing), that the bank won’t send her monthly bills. She can’t even check her outstanding balance or even confirm that the bank has received payments online.  The bank is demanding Bridgette make a 60% lump sum payment to move the loans back into repayment and to allow her to start rebuilding her credit. That’s $27,000  that she can’t afford.

clarissa sallie maeWith youth unemployment high, banks need to change their practices to work with their borrowers, not hang them out to dry. And our politicians and regulators need to be held accountable to make sure that student loans open up a path to success and security instead of walling it off.

So thanks to you all of you have shared your stories with us. Please know that we’ll keep bringing your voices to both the decision makers and the public.