Title: Servicemember Student Loan Affordability Act of 2020
Policy area: Armed Forces and National Security

Summary:
Servicemember Student Loan Affordability Act of 2020
This bill extends the 6% interest rate limitation on debt entered into during a service member's military service to any debt entered into to consolidate or refinance one or more student loans incurred before such service.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[S. 4002 Introduced in Senate (IS)]

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116th CONGRESS
  2d Session
                                S. 4002

  To amend the Servicemembers Civil Relief Act to extend the interest 
 rate limitation on debt entered into during military service to debt 
 incurred during military service to consolidate or refinance student 
                loans incurred before military service.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             June 18, 2020

  Mr. Durbin (for himself and Ms. Duckworth) introduced the following 
 bill; which was read twice and referred to the Committee on Veterans' 
                                Affairs

_______________________________________________________________________

                                 A BILL


 
  To amend the Servicemembers Civil Relief Act to extend the interest 
 rate limitation on debt entered into during military service to debt 
 incurred during military service to consolidate or refinance student 
                loans incurred before military service.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Servicemember Student Loan 
Affordability Act of 2020''.

SEC. 2. INTEREST RATE LIMITATION ON DEBT ENTERED INTO DURING MILITARY 
              SERVICE TO CONSOLIDATE OR REFINANCE STUDENT LOANS 
              INCURRED BEFORE MILITARY SERVICE.

    (a) In General.--Subsection (a) of section 207 of the 
Servicemembers Civil Relief Act (50 U.S.C. 3937) is amended--
            (1) in paragraph (1), by inserting ``on debt incurred 
        before service'' after ``Limitation to 6 percent'';
            (2) by redesignating paragraphs (2) and (3) as paragraphs 
        (3) and (4), respectively;
            (3) by inserting after paragraph (1) the following new 
        paragraph (2):
            ``(2) Limitation to 6 percent on debt incurred during 
        service to consolidate or refinance student loans incurred 
        before service.--An obligation or liability bearing interest at 
        a rate in excess of 6 percent per year that is incurred by a 
        servicemember, or the servicemember and the servicemember's 
        spouse jointly, during military service to consolidate or 
        refinance one or more student loans incurred by the 
        servicemember before such military service shall not bear an 
        interest at a rate in excess of 6 percent during the period of 
        military service.'';
            (4) in paragraph (3), as redesignated by paragraph (2) of 
        this subsection, by inserting ``or (2)'' after ``paragraph 
        (1)''; and
            (5) in paragraph (4), as so redesignated, by striking 
        ``paragraph (2)'' and inserting ``paragraph (3)''.
    (b) Implementation of Limitation.--Subsection (b) of such section 
is amended--
            (1) in paragraph (1)(A), by striking ``the interest rate 
        limitation in subsection (a)'' and inserting ``an interest rate 
        limitation in paragraph (1) or (2) of subsection (a)''; and
            (2) in paragraph (2)--
                    (A) in the paragraph heading, by striking 
                ``effective as of date of order to active duty'' and 
                inserting ``effective date''; and
                    (B) by inserting before the period at the end the 
                following: ``in the case of an obligation or liability 
                covered by subsection (a)(1), or as of the date the 
                servicemember (or servicemember and spouse jointly) 
                incurs the obligation or liability concerned under 
                subsection (a)(2)''.
    (c) Student Loan Defined.--Subsection (d) of such section is 
amended by adding at the end the following new paragraph:
            ``(3) Student loan.--The term `student loan' means the 
        following:
                    ``(A) A Federal student loan made, insured, or 
                guaranteed under title IV of the Higher Education Act 
                of 1965 (20 U.S.C. 1070 et seq.).
                    ``(B) A private student loan as that term is 
                defined in section 140(a) of the Truth in Lending Act 
                (15 U.S.C. 1650(a)).''.
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