ALBANY — Gov. Cuomo on Friday unveiled set of measures intended to aid New Yorkers struggling with “exploding” student loan debt.
The proposals, which will be part of Cuomo’s State of the State Address next week, include new financial disclosure requirements for colleges and universities, and new consumer protection standards for the loan industry.
Cuomo also plans to create a student loan ombudsman within his administration to help resolve complaints and enact new regulations that prohibit state agencies from suspending any professional license because the holder is behind on student loan payments.
“With this proposal, we build on the success of the Excelsior Scholarship and lay out a concrete roadmap to alleviate the burden of student debt in New York and equip our students with the protections and the tools they need to succeed,” Cuomo said, referring to the state program that offers free SUNY and CUNY tuitions to middle class families.
Under Cuomo’s proposal, student loan servicers and debt consultants would need a license from the state’s Department of Financial Services to operate in New York and would be required to give “clear and conspicuous disclosures to borrowers.” They would also be barred from charging any upfront fees.
Colleges in the state would also be required to inform students annually about the status of their loans.
The Cuomo administration estimates that the average student loan burden in New York is more than $30,000. Nationally, student loan debt is the second highest debt category after mortgage debt, amounting to $1.48 trillion nationwide.
“Today, a college education is a necessity for a middle class life, yet the crushing weight of student loan debt often keeps New Yorkers from buying homes, cars and ultimately limits their ability to save money and invest in their futures,” Cuomo said.
