Federal student loan repayment plan rules should be eased, says ABA House
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A resolution calling on Congress and the White House to authorize the suspension or forgiveness of student loans and to make it easier to qualify for repayment plans was adopted Monday by the ABA House of Delegates.
Resolution 106C asks that repayment plans be opened up to people with student loans from commercial lenders, and it seeks less restrictive terms for loan consolidation. It also asks that the federal government allow student borrowers to refinance with more favorable rates offered in later years and provide borrowers with temporary assistance to meet student debt obligations.
The House vote was 335 in favor, with 37 opposed.
Resolution 106C was brought by the Young Lawyers Division, the Law Student Division and the Standing Committee on Paralegals. In 2020 the YLD surveyed 1,084 attorneys. More than 75% had at least $100,000 in student loans upon graduation. More than half of the respondents had more than $150,000 in school loans. The average age of respondents was 32.
Aaron P. Sohaski, a Detroit lawyer who serves as director of student debt and financial wellness for the YLD, spoke in favor of the resolution. He noted that the division’s 2020 survey also found that many young lawyers were pushing back or forgoing life decisions such as buying homes due to their school loan debt. The situation was also detailed in the December 2020-January 2021 cover story of the ABA Journal.
“Rather than pumping money into the economy in traditional ways, as one would expect a member of the middle class to do, much of their expendable income goes to paying down interest on student loans,” Sohaski said.
Another resolution, asking that federal student loans be allowed to be discharged in bankruptcy, was withdrawn Saturday. Resolution 106B was also brought by the YLD, the Law Student Division and the Standing Committee on Paralegals. Its advocates stated that they anticipate reintroducing a similar resolution at the 2021 ABA Annual Meeting in August.
Follow along with the ABA Journal’s coverage of the 2021 ABA Midyear Meeting here.