Representatives Pappas and Kuster call on Department of Education to protect federal workers with student loans
Washington, D.C. - With the longest shutdown in American history behind us, Congressman Chris Pappas and Congresswoman Annie Kuster are urging Secretary of Education Betsy DeVos to implement new guidelines at the Department of Education (DOE) to protect federal workers who are unable to make student loan payments in the event of future government shutdowns. In a letter to Secretary DeVos, they recommended new guidelines at the Department of Education (DOE) that would mandate student loan providers to proactively reach out to both essential and furloughed federal employees to assist with student loan payments. Since being sworn into office during the longest government shutdown in our nation’s history, Congressman Pappas and Congresswoman Kuster have fought to ensure hardworking people across the Granite state do not suffer long term financial hardships as a result of Washington dysfunction.
Below is the text of the letter sent to the Department of Education. Please find the original letter attached.
Dear Secretary DeVos:
We write today on behalf of our constituents in New Hampshire who are both federal employees and holders of student loan debt. During the recent shutdown, many struggled to choose between paying for basic household expenses and meeting their student loan obligations. While the government has reopened until February 15th, the effects of going without pay for so long will linger and we may find ourselves in similar situations again in the future. We therefore urge you to implement permanent policies now to assist federal employees in making their student loan payments in the event of another government shutdown.
Approximately 2,400 federal employees in New Hampshire were affected by the recent government shutdown. When furloughed or forced to work without pay because of a government shutdown, many of these workers must confront difficult financial decisions. In addition to uncertainty over feeding their families and paying their mortgages, many federal employees also struggled to make their student loan payments during the recent shutdown. As you are aware, missed payments can result in default and potentially lasting damage to the borrower’s credit history. It is unacceptable and unreasonable that these hardworking Americans should be forced to bear this burden.
New Hampshire college students graduate with some of the highest average student loan debt in the country - $34,415 in 2017. Based on a 10-year repayment plan, with an average 4.81% interest rate, this means an average monthly payment of $362. Even when they receive a paycheck, this is a significant burden -- $362 represents over 18% of their average take home pay. When furloughed or working without pay, it becomes even more difficult for these Granite Staters to meet their student loan obligations.
For these reasons, we urge the Department of Education to develop a policy that directs student loan servicers to proactively reach out to federal employees in the event of a government shutdown and provide guidance on alternative payment options and protections.
The hardworking federal employees of New Hampshire should not be forced to default on their student loans due to partisan standoffs in Washington. They deserve the full assistance of the Department of Education and student loan providers during any lapse in appropriations.
We appreciate your attention to this important matter.
Chris Pappas Ann McLane Kuster
Member of Congress Member of Congress