Date: 2008-04-16
Speaker: GEORGE MILLER (democrat)
Chamber: H
State: California

I yield myself 5 minutes. Mr. Chairman. Members of the House. I rise in strong support of H.R. 5715. the Ensuring Continued Access to Student Loans Act of 2008. It was reported by the Committee on Education and Labor with unanimous bipartisan support. and I want to thank my colleagues on both sides of the aisle for all of the effort they put. into this legislation. It is a very important piece of legislation. At a time when the turmoil in the Nations credit markets has made it difficult for some lenders to access the capital they need to finance their student lending activity. this bipartisan bill will eflsure that students and parents are able to continue to access the federal loans they need to pay for college. For quite some time now. the worsening economic downturn has made life more difficult for many of Americas families. But this downturn has its root in the housing crisis. which has led to significant tightening in the credit markets. What began as a challenge for home loan borrowers has now become a challenge for other borrowers. like those with credit card debt and automobile loans. And in recent months. we have now seen questions raised about the availability of student loans for the coming year. especially when those who finance their loans through the auction rate securities. that system has ceased to function. As a result. some lenders are reducing their lending activity in the federally guaranteed student loan programs. while other lenders are anticipating increasing their market share. And while the stress in the credit markets is taking a toll on some lenders. students so far have not encountered serious difficulties in getting federal loans they need to pay for college. Thats the good news. But as we have seen too often. the shocks in the financial markets come as a surprise leaving those affected with little time to react. There is emergency authority already built into the current law which would maintain access to federal loans for families in the event of any of these surprises. It is critical to make sure that this authority is ready to be implemented to ensure Americas families can continue to access the federal college loans they are eligible for. regardless of whats happening in the credit markets. As we work with Secretary Spellings to make sure these safeguards are ready to become operational at a moments notice. we must also take additional steps on behalf of students and their families. This legislation provides new protections. in addition to those in current law. to ensure that families can continue to access the loans they need to pay for college. The bill reduces borrowers reliance on costlier private loans while encouraging responsible borrowing by increasing the annual student loan limits for federal student loans by $2.000 for all students. It also increases the total amount of Federal loans students can borrow to $31.000 for dependent undergraduates and to $57.500 for independent undergraduates. H.R. 5715 gives parent borrowers more time to pay off their federal parent PLUS loans by allowing families to delay entering repayment for up to 6 months after a student leaves school. It helps struggling home owners pay for college by making sure that shortterm delinquencies in mortgage payments dont prohibit otherwise eligible parents from being able to pay their PLUS loans. It clarifies that existing law gives the Secretary of Education the authority to advance federal funds to guaranty agencies in the event that they do not have sufficient capital to originate new loans. It allows guaranty agencies to make lenderoflastresort loans on a schoolwide basis. And the bill ensures that lenders can continue to access capital to originate new student loans by giving the Secretary of Education the temporary authority to purchase federally guaranteed student loans from lenders. if needed. Finally. this legislation carries no new costs for taxpayers. Especially in light of todays economic conditions. the high cost of a college education continues to be one of the primary worries facing American families. A recent poll conducted by the New York Times and CBS News found that 70 percent. of the parents surveyed said they were "very concerned" about how they would finance their kids college education. Over the past year and a half. this Congress has worked vigorously to make college more affordable and accessible for students and families. Last year. we took the historic step towards this goal by providing more than $20 billion in financial assistance to lowand middleincome families over the next 5 years. In February. the House passed bipartisan legislation to reauthorize the Higher Education Act. and we will soon be prepared to conclude the conference committee and bring that to the floor. Now more than ever. families deserve every assurance that we are doing all that we can to make sure that they can continue to be able to finance their childrens college education. regardless of what happens in the credit markets. And I want to again thank Congressman BUCK MCKEON. Congressman RUBhN HINOJOSA and Congressman Ric KELLER. the Chair and the ranking member of the subcommittee. and all of the staff for all of the work they have put into this legislation. This has been a very fast turnaround. It could not have happened without the bipartisan cooperation of all of those involved. I reserve the balance of my time.