HELP Act: Forgive Student Loans for Ill or Deceased Borrowers

By Briana Vannozzi

“Every month I have to write a check, for the next seven or eight years reminding myself that my son is not going to graduate,” said Marcia DeOlivera-Longinetti.

Her story set off a domino effect across the state. DeOlivera-Longinetti was battling New Jersey’s higher ed loan authority and its aggressive tactics to collect payments for her murdered son’s outstanding student debt. It turned out she wasn’t alone. More stories trickled out from families unable to secure forgiveness for ill or deceased borrowers.

Why have these lenders been able to get away with this?

“I mean simply because there’s no law that prevents it and so they, you know, they’re trying to recoup their money,” said Congressman Frank Pallone.

At a roundtable held on Middlesex County College’s campus today, Pallone unveiled new legislation to fight this is at the federal level.

The Student Borrower Higher Education Lending Protection, or HELP, Act will forgive student debt in the event of death, permanent disability or should a co-signer die. It’ll suspend debt without financial penalty for temporary disabilities and require private lenders to disclose default rates.

“I think that New Jerseyans generally expect that a state-run loan program would work with them when they have a hardship like that, but that’s not been the case,” Pallone said.

The HELP Act applies to private lenders and HESAA — the state Higher Education Student Assistance Authority. It’s a companion to a package of state bills that will protect students from the same practices.

We reached out to comment from HESAA, but they did not return our request.

“We need to be more about taking care of our students and helping our students to get what they need to graduate. That’s very important. So we need to sit down with everybody and make sure that everyone is being treated fairly, but more importantly that all of these lenders are treating our students fairly,” said Sen. Sandra Cunningham.

“Eighteen months ago we put a commission together to give recommendations on how to improve the cost of education in this state,” said Senate President Steve Sweeney.

Sweeney says he’s pushing for more 3+1 programs, allowing students to spend three years earning their degree at a community college — for a lower cost — before completing the last at the four-year institution.

“In regards to attending a four-year university, there’s so many colleges I want to attend but sometimes the fear of cost kind of hinders me from achieving that,” said Middlesex County College student Lauke Heojo.

“Getting loans does hold people back because some people, nowadays you can see people have certificates, degrees and they’re not working at the job they have,” said Middlesex County College student Cristopher Tito.

Today’s roundtable was intended to spur more ideas on college affordability. Congressman Pallone says New Jersey families face $31 billion in student loan debt. Meanwhile that package of state bills to reform student loan repayment will be moved through the Senate next week.