Guthrie Statement: Markup of H.R. 3179, "Empowering Students Through Enhanced Financial Counseling Act"
WASHINGTON, D.C., June 22, 2016
I’m happy to be here today to help address several challenges facing Americans pursuing a higher education. One of those challenges is understanding the federal financial aid process.
Students and parents face a number of difficult questions when considering their higher education opportunities. Deciding how to responsibly finance and pay for their education is an important part of that process.
Unfortunately, the policies in place to promote the financial literacy of aid recipients are seriously lacking. In fact, in a survey of current students and recent graduates who are carrying a high level of student loan debt, more than 40 percent couldn’t remember ever receiving financial counseling—even though it was required before receiving their first loan.
The current system is ineffective and failing to help students make the best financial decisions for their future. Without the information and assistance they need, applicants could make a choice about financial aid that will have detrimental consequences not only in the near-term but for years to come.
That’s why I worked with Representatives Allen and Bonamici to introduce H.R. 3179, the Empowering Students Through Enhanced Financial Counseling Act. This bill will help Americans make smart decisions when it comes to financing their higher education by improving the timing and frequency of loan counseling. First, it will require individuals to receive their counseling before signing on the dotted line, helping students understand the responsibilities they are taking on and keeping them well-informed every step of the way.
Additionally, the legislation will bolster exit counseling to help borrowers make smart financial decisions as they leave school. It’s not enough to be aware of financial options and commitments before and during school. We need to empower students to make smart financial decisions as they begin to repay their college loan commitments, as well.
H.R. 3179 will also enhance the content of financial aid counseling, ensuring it is tailored to a borrower’s unique needs and individual circumstances, and it will require the secretary of education to maintain a consumer-tested, online counseling tool for institutions to use in providing required financial counseling.
In today’s anemic economy—as college costs continue to rise—students and their families cannot afford the cost of making poor financial decisions in pursuit of a higher education. The Empowering Students Through Enhanced Financial Counseling Act will help students receive the information they need to understand their options and make financially responsible decisions as they work to achieve their goals.
The substitute amendment I am offering makes noncontroversial technical changes. I urge my colleagues to support the amendment and the underlying legislation.
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