Congressman José E. Serrano

Representing the 15th District of New York

Serrano, Velázquez, Plaskett, González-Colón Send Letter Urging DeVos to Provide More Assistance for Student Loan Borrowers in Puerto Rico and U.S. Virgin Islands Affected by Hurricanes

Oct 18, 2017
Press Release

Washington, D.C. – Today, Congressman José E. Serrano (D-The Bronx) sent a letter along with Congresswomen Nydia M. Velázquez (NY), Stacey E. Plaskett (VI), Jenniffer González-Colón (PR), and 52 members of the U.S. House of Representatives urging U.S. Secretary of Education Betsy DeVos to do more to help federal student loan borrowers in Puerto Rico and the U.S. Virgin Islands that have been affected by Hurricanes Maria and Irma. Both territories were decimated after the two storms and continue to experience widespread power outages and lack of communication capabilities that prevent borrowers from having their loans placed in forbearance during this difficult time.

“The situation in Puerto Rico and the U.S. Virgin Islands is so dire that most of the two territories remain without power and unable to communicate. That is why it is so difficult for student borrowers to have their loans placed in forbearance, if they know about this benefit to begin with,” said Congressman Serrano. “The Department of Education must live up to its obligations to provide borrowers with as much assistance as possible as they rebuild their lives and communities. While this may seem small, it will give our fellow Americans in Puerto Rico and the U.S. Virgin Islands the peace of mind to focus on greater priorities instead of paying student loans until they are back on their feet once again.”

“We need to be employing every tool in the federal toolbox to assist residents of Puerto Rico and help them recover from Maria. Ensuring recent graduates, teachers and students can secure forbearance on their student loans would be one important step in helping alleviate the hardship facing these U.S. citizens,” said Rep. Nydia M. Velázquez (D-NY).

"After being hit by two Category Five hurricanes the residents of the Virgin Islands with student loan debt are carrying a serious financial and emotional burden. The pressure of making big monthly loan payments is taking its toll in terms of stress, housing affordability and quality of life.  The Federal Government, specifically the Department of Education, must serve a critical and ongoing role in supporting the people of the Virgin Islands with student loans as the government continues to respond to, recover from, and persevere through the destruction caused by Hurricane Irma and Maria,” said Congresswoman Stacey E. Plaskett.

“Puerto Rico and the U.S. Virgin Islands are struggling to recover from both Hurricanes Irma and Maria.  Almost 90 percent of Puerto Rico remains without power and there is no power in St. John and very limited power on St. Thomas and St. Croix.  Many U.S. citizens in both territories are without shelter and communication.  Hurricane survivors are doing their best to get their life back on track and restore normalcy to their everyday life, including student borrowers.  However, most are not in a position to communicate with their lenders or access guidance from the Department of Education.  Therefore, it is imperative that the Department of Education use all its resources and authority to assist student borrowers during this difficult time, including placing their loans in forbearance.  Protecting the fiscal health of student borrowers is critical to the economic recovery of Puerto Rico and the U.S. Virgin Islands,” said Resident Commissioner Jennifer Gonzalez.  

With hundreds of thousands of federal student loan borrowers in Puerto Rico and the U.S. Virgin Islands, the letter calls on Secretary DeVos to ensure all servicers are providing benefit information in both English and Spanish, and seek Congressional authority in the upcoming emergency supplemental to automatically place all borrowers affected by Hurricanes Maria and Irma into interest-free forbearance for six months, or until both territories are no longer declared disaster zones. Servicers have been working to provide information via email and by phone, but as both islands continue to experience widespread power outages, and cell and landline phone service is still nearly non-existent, these borrowers are not able to access these benefits quickly or receive the necessary information. Automatic enrollment in interest-free forbearance will ensure all borrowers in the affected areas are not penalized with interest as they continue with recovery efforts.

Full text of the letter:

October 16, 2017

The Honorable Betsy DeVos

Secretary

U.S. Department of Education

400 Maryland Ave, SW

Washington, D.C. 20202

Dear Secretary DeVos:

Puerto Rico and the U.S. Virgin Islands have recently experienced the worst natural disasters to hit the islands in almost a century. Shortly after these storms made landfall, the devastation has been so widespread, leaving most of the islands’ residents without power, potable water, food, transportation, or the ability to communicate reliably with loved ones. The schools in Puerto Rico and the Virgin Islands were not spared from damage. Some schools are still inaccessible and others are still serving the over 9,100 refugees still living in shelters.  

While other federal agencies continue to grapple with response efforts in order to save lives, restore power, and rebuild, the U.S. Department of Education must not forget its moral obligation to grant relief to the hundreds of thousands of Puerto Ricans and Virgin Islanders that currently hold a federal student loan.[1] To date, the Department has made little to no effort to provide any administrative reprieve to the islands’ large population facing student loan repayment notices as they cope with the loss of loved ones, the destruction of their homes, work layoffs and furloughs.

The U.S. Department of Education released guidance on its website urging borrowers in the affected areas to call their student loan servicers to halt student loan payments temporarily- albeit, while interest continue to accrue.[2] To ensure borrowers are not accruing interest while in forbearance, we urge the Department to do more.

Under current regulation, subsidized loan borrowers who have deferred their loans due to economic hardship are not required to make payments of loan principal and interest does not accrue. On its website, the Department should urge borrowers to submit an economic hardship request. Additionally, the Secretary should send guidance to loan servicers advising them to tell all borrowers living in affected areas of this option.

Borrowers with unsubsidized loans can also benefit from an interest-free option. Under the Revised Pay As You Earn (REPAYE) repayment plan, the Department already provides an interest subsidy on unsubsidized loans. Under this benefit, up to half of the interest that accrues on unsubsidized loans during periods of negative amortization may be subsidized. It is possible that many borrowers do not know of this benefit and thus, may not request to switch plans. We urge you to notify borrowers of this benefit in REPAYE.

Additionally, we urge the Department to provide borrowers with any information in English and Spanish and require the servicers to have Spanish-speaking representatives available to serve these borrowers.

The lack of electricity and internet capabilities post-storm will significantly delay the take-up of these benefits. Given the inability of American citizens in Puerto Rico and the U.S. Virgin Islands to communicate with their servicers, the Department of Education should include in its request authority to automatically enroll all borrowers affected by Hurricanes Maria and Irma into forbearance. Moreover, while borrowers are in forbearance, interest should not be accruing. An interest-free mandatory administrative forbearance is the best way to ensure borrowers are not adversely affected during this difficult time.  

The future of the people and economy in these U.S. territories depend on our complete and unequivocal support. We urge the Department of Education to do more to protect student loan borrowers as they continue to piece together their lives in the wake of devastation resulting from Hurricanes Maria and Irma. We thank you for your immediate response to this crisis and stand ready to help in any way that we can.

Sincerely,

 

 

 

 

José E. Serrano

Member of Congress            

 

 

 

 

Nydia M. Velázquez    

Member of Congress                                    

 

 

 

 

Stacey E. Plaskett

Member of Congress

 

 

 

Jenniffer González-Colón

Member of Congress

 

 

 

John Conyers, Jr.

Member of Congress

 

 

 

Adriano Espaillat

Member of Congress

 

 

 

Brian Higgins

Member of Congress

 

 

 

John Garamendi                               

Member of Congress

 

 

 

Henry C. "Hank" Johnson, Jr.

Member of Congress

 

 

 

Stephanie Murphy

Member of Congress

 

 

 

Alan S. Lowenthal

Member of Congress

 

 

 

Carol Shea-Porter

Member of Congress

 

 

 

 

André Carson

Member of Congress

 

 

 

 

Frank Pallone, Jr.

Member of Congress

 

 

 

 

Raúl M. Grijalva

Member of Congress

 

 

 

Zoe Lofgren

Member of Congress

 

 

 

Debbie Wasserman Schultz

Member of Congress

 

 

 

Richard E. Neal

Member of Congress

 

 

 

Kathleen M. Rice

Member of Congress

 

 

 

Joyce Beatty

Member of Congress

 

 

 

Jerrold Nadler

Member of Congress

 

 

 

Doris Matsui

Member of Congress

 

 

 

Yvette D. Clarke

Member of Congress

 

 

 

Joseph Crowley

Member of Congress

 

 

 

Eleanor Holmes Norton

Member of Congress

 

 

 

Grace Meng

Member of Congress

 

 

 

Judy Chu

Member of Congress

 

 

 

Hakeem S. Jeffries

Member of Congress

 

 

 

Darren Soto

Member of Congress

 

 

 

Ben Ray Luján

Member of Congress

 

 

 

Pramila Jayapal

Member of Congress

 

 

 

Luis V. Gutiérrez

Member of Congress

 

 

 

Frederica S. Wilson

Member of Congress

 

 

 

Lucille Roybal-Allard

Member of Congress

 

 

 

Marcy Kaptur

Member of Congress

 

 

 

Ro Khanna

Member of Congress

 

 

 

Joaquin Castro

Member of Congress

 

 

 

John B. Larson

Member of Congress

 

 

 

John Lewis

Member of Congress

 

 

 

 

Karen Bass

Member of Congress

 

 

 

 

Kathy Castor

Member of Congress

 

 

 

 

Danny K. Davis

Member of Congress

 

 

 

Colleen Hanabusa

Member of Congress 

 

 

 

Chellie Pingree

Member of Congress

 

 

 

Norma J. Torres

Member of Congress

 

 

 

Lisa Blunt Rochester

Member of Congress

 

 

 

Susan A. Davis

Member of Congress

 

 

 

Gregorio Kilili Camacho Sablan

Member of Congress

 

 

 

Salud Carbajal

Member of Congress

 

 

 

Barbara Lee

Member of Congress

 

 

 

Brendan F. Boyle

Member of Congress

 

 

 

Donald M. Payne, Jr.

Member of Congress

 

 

 

Robert C. “Bobby” Scott

Member of Congress

 

 

 

Nanette Diaz Barragán

Member of Congress

 

 

 

Al Lawson

Member of Congress

 

 

 

Mark DeSaulnier

Member of Congress

 

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Congressman José E. Serrano has represented The Bronx in Congress since 1990.  He is a Senior member of the House Appropriations Committee. 

 

[1] Federal Student Loan Portfolio, Federal Student Aid, U.S. Department of Education, October 4, 2017. https://studentaid.ed.gov/sa/about/data-center/student/portfolio.

[2] Natural Disasters: Information for Affected Individuals, Federal Student Aid, U.S. Department of Education, October 4, 2017. https://studentaid.ed.gov/sa/about/announcements/disaster#harvey