When most parents are asked what they would like to be able to provide for their children, a great education is at the top of the list. A college education is seen as the golden ticket to making sure our children have a fair shot at earning a good-paying job, finding affordable housing, and saving enough for retirement.
Unfortunately, too many students are graduating from college saddled with debt, often due to varying interest rates or fees from their private lender that jacked up the cost of their education. Taking out a private loan has become just another financial obstacle later on in life; another bill families have to pick between when deciding what bills they can afford that month, with seemingly no end in sight. In fact, Americans currently hold over $1 trillion in student loan debt, ultimately holding back their earnings and a chance at success. I’m one of those Americans still paying off my student loan debt.
I worked my way through college with multiple jobs, studied hard for my classes, and played by the rules that said if you work hard and earn a degree, you can achieve your own American Dream. I’ve been fortunate in my career, which makes my obligation to give those in the middle class who saw the private lending system work against them, the same opportunities I had after I graduated.
That’s why I’m introducing the Know Before You Owe Act, Senate Bill 16-043, in the Colorado Senate, which would make sure students have the information they need to make the very best decisions on how to pay for their education. My legislation will crack down on private, for-profit lenders and require them to disclose the true cost of student loans to consumers before borrowing, as well as provide them information on lower cost federal loans they can take advantage of before moving to a private lender.
Private lenders offer loans with higher interest rates that are harder to pay off than federal loans, and are chock full of various fees that add significant costs onto an already expensive education in Colorado. My legislation will ensure students know as much as possible about their rights and eligibility from a private lender before taking one out to pay for college.
At a time when too many Coloradans feel like the system has been rigged against their success, this idea will help remove the smoke and mirrors from the student loan process, and give power back to Coloradans to make the very best financial choices when going after that golden ticket of a higher education.
Morgan Carroll is the State Senator for Senate District 29, which represents Aurora and East Arapahoe County.