September 15, 2015
Rep. Lesser was honored to join Governor Dannel Malloy as he ceremoniously signed two groundbreaking student loan reforms into law at the University of St. Joseph on Friday, September 4 2015. Governor Malloy signed PA 15-200, An Act Concerning the Duties and Authority of the Connecticut Higher Education Supplemental Loan Authority and PA 15-162, An Act Concerning a Student Loan Bill of Rights.
Rep. Lesser spearheaded the first-in-the-nation Student Loan Bill of Rights. The law regulates the student loan servicing industry and establishes an office of the Student Loan Ombudsman to help students resolve complaints with loan servicers as well as with their university. The Ombudsman will also compile data on borrower complaints and develop a student borrower education course to help improve financial literacy among college students.
“Connecticut students graduate with an average of more than $30,000 in debt and student loan debt is the second leading cause of indebtedness following only home mortgages. These shackles prevent graduates from starting businesses, owning homes, even starting families. I am grateful to Governor Malloy for his leadership and proud that Connecticut is leading the nation on the issue of student loan debt,” said Rep. Lesser.
The Governor also signed a law which led to the Connecticut Higher Education Supplemental Loan Authority (CHESLA) offering its lowest fixed interest rate ever for student loans. CHESLA’s new rate is 4.95% down from 6.75%. In addition to the significant rate decrease, CHESLA will also be increasing the maximum allowed debt-to-income ratio from 40% to 43%. The bill also allows CHESLA to refinance existing student loans to today's lower interest rates.
"Unfortunately despite the best efforts of Connecticut's delegation, Congress has thrown up roadblocks that make it difficult for states to refinance federal student debt. We are working to find ways around that," Lesser said, adding, “The rate decrease for new loans is making an immediate difference for Connecticut families struggling to finance college and graduate school. Thanks to these reforms, CHESLA is now offering its lowest interest rates ever. This significant rate change will help open doors for students who may not have been able to afford higher education, and will strongly benefit our state economy."