Proposed bills would aid student debt

The Minnesota Legislature currently faces the question of whether to create a statewide student loan debt counseling program, the Minnesota Daily reported last week. If the bills introduced in February pass, then the state will select a nonprofit organization to help borrowers gather financial information and determine strategies to manage payments that are 30 to 60 days late.

In 2013, the Project on Student Debt revealed that Minnesota ranked fifth-highest in the nation for average student debt. Students who graduate from a four-year institution in Minnesota do so with $30,894 worth of debt, on average.

If the loan-counseling program is created, it would help serve an estimated 2,400 people annually. According to Sen. Greg Clausen, DFL-Apple Valley, it would cost $600,000 in both 2016 and 2017. This is the equivalent of approximately $250 per person.

Currently, University of Minnesota policy requires all borrowers who accept University or federal loans to complete an online exit course before they graduate. The course covers subjects such as repayment and deferral.

Additionally, Boynton Health Service and Lutheran Social Services offer free loan counseling for students who feel overwhelmed or anxious about any debts they incur to pay for tuition.

Because the student debt crisis has grown so severe, we support the creation of a formal body to help students manage their loans. Furthermore, we would like to see the University do more to publicize the resources it offers to help students manage their debts, as we feel these services are valuable but relatively unknown.