TRENTON – Legislation sponsored by Senators Sandra Bolden Cunningham, M. Teresa Ruiz and Bob Gordon to bring transparency and accountability to the state’s student loan program was signed into law by the Governor today.
“This law will bring long-needed transparency and accountability to the student loan program run by the state’s higher Education Student Assistance Authority,” said Senator Cunningham (D-Hudson). “We need to ensure that future graduates will not endure the financial hardships that many current graduates are facing. These are changes that will make a difference in the lives of young people and will have a lasting impact on the strength of our great state and our economy.”
“We need to increase transparency so that students and families have more information on the financial hurdles and challenges they may face after college and potentially over the long term,” said Senator Ruiz (D-Essex), a sponsor of S-2577. “Our goal is to ensure that families and students understand exactly the kind of terms attached to these loans. We want young people to come away from their education proud and ready to achieve success, not burdened by debt and financial struggles.”
“This legislation is part of a package of bills aimed at reforming the loan collection process and helping students who go to college to have a manageable payment plan in the years after they graduate,” said Senator Gordon (D-Bergen/Passaic). “We need to know that HESAA is not issuing loans that are in excess of what a borrower can manage over the long-term, and we need to ensure that borrowers understand how state loan repayment terms stack up against federal loans.”
In August, the Senate Legislative Oversight Committee chaired by Senator Gordon and the Senate Higher Education Committee led by Senator Cunningham heard from student borrowers and families about their financial hardships and the Higher Education Student Assistance Authority’s aggressive collection tactics and strict conditions that some said had ruined them financially.
The new law requires HESAA to provide detailed annual New Jersey College Loans to Assist State Students Loan Program reports to the Governor and Legislature and to develop student loan comparison information document to increase program transparency. The purpose of this bill is to increase transparency under the NJCLASS Loan Program and public knowledge and awareness of the strict loan repayment requirements under the program as compared to federal student loan programs.