Recently on the Student Loan Report, political actions in Virginia were covered involving student loan reform and Virginian financial aid provisions. More details on those developments can be found here.
Currently, Democrats in the House Caucus are championing a bill that explicitly brings the state of Virginia back into student loan origination and disbursement. One of the main incentives of the legislation from Monday reforms the long dead Virginia Education Loan Authority which has been gone for nearly twenty years.
Similar legislation was proposed at a previous general assembly, but it was limited in its approach to reforming financial aid in Virginia. The original proposal called for an authority specializing in consolidating student loans at lower rates in the state of Virginia. Since this initial proposal was critiqued negatively by the State Council of Higher Education, the proposal foundered in the water. Despite this, a new proposal sought to expand the original proposal, hence the potentially reinstated Virginia Education Loan Authority.
Delegate Charniele Herring alluded to the necessity for the VA Education Loan Authority by describing the economic impact of student loans in Virginian as “profound.” To put it in perspective, around 1 million citizens of Virginia are burdened with student loans. Right now, the average VA student loan debt per borrower is roughly $30,000 which brings the total VA student debt load to $30 billion. This is approximately 2.1% of total national student loan debt.
There are actually a couple of proposals to consider. First, the creation of the Virginia Student Loan Authority is meant to aid students who are currently experiencing heavy burdens with their loans. This is to be done mainly through refinancing. Second, another bill proposes measures to help students in the future from reaching the same burden level. One of these measures involved