MADISON, Wis. — Student loan borrowers in neighboring Minnesota got good news this week with the kick off of a state-based loan refinancing program that could save participants hundreds of dollars every month. Meanwhile in Wisconsin, the state with the third highest percentage of 2014 graduates with student loan debt in the nation, borrowers got a new excuse from Gov. Scott Walker for his continued opposition to common-sense refinancing legislation, Connecticut.
“We’re third in the nation for percentage of 2014 graduates with student loan debt,” said One Wisconsin Now Executive Director Scot Ross. “It’s common sense solutions like allowing loans to be refinanced that will help these borrowers, not the excuses and empty political gestures Gov. Walker and the Republican legislature are offering up.”
According to media reports, a state-based student loan refinancing program launched Thursday in Minnesota. Under the plan, student loans will be able to be refinanced through their higher education agency. A program representative estimated that a borrower with $40,000 in student debt at an eight percent interest rate could save between $200 and $300 dollars every month with a refinanced loan. The White House estimated that a federal refinancing plan would immediately help over half a million borrowers in Wisconsin. With an average student loan debt of nearly $30,000, the savings to Wisconsin borrowers could provide a real economic boost to a state lagging the midwest in job creation under the failed policies of Gov. Walker.
In Wisconsin, the Higher Ed, Lower Debt Act, introduced in 2013 and again in 2015 by Senator Dave Hansen and Representative Cory Mason, and sponsored by fifty state legislators, would help borrowers by creating a state authority to help them refinance their student loans, just like you can with a mortgage. The bills, Senate Bill 194 and Assembly Bill 272, also help borrowers by extending a state tax break to payments on student loans.
Walker is publicly claiming he opposes the bill and allowing Wisconsin borrowers to refinance their student loans based on an erroneous representation of policies in Connecticut. In fact, Walker’s policies have exacerbated the student debt crisis. University of Wisconsin system tuition has been hiked by double digits, higher education and technical colleges have taken huge funding cuts totalling roughly $700 million and financial aid has been so woefully underfunded that over 40,000 students eligible for assistance were denied any help.
Ross concluded, “Everyone but Gov. Walker and the Republican Legislature recognizes student loan debt is a crisis. Nearly one million Wisconsin borrowers deserve action, not more excuses from Gov. Walker.”