states revoking licenses over student loan defaults

States revoking licenses over student loan defaults license#
States revoking licenses over student loan defaults professional#

For instance, the Illinois Department of Financial and Professional Regulations couldn’t determine how much student loan debt has been recovered. In spite of the extreme punitive nature of these laws and the zeal with which they were enforced, they proved to be quite ineffective.

States revoking licenses over student loan defaults license#

A new state law aims to stop this vicious cycle of debt and loss of employment, and BRIDGE/MSW Pathways Co-Director Claudio Martinez urges the Senate to pass the law in a recent op-ed to help address the student loan crisis.Įxcerpt from, “ Pass the Professional License Bill to Save Student-Loan Debt Holders ” by Claudio Martinez, originally published in Boston Business Journal: State Administration and Regulatory Oversight. Fourteen states currently assert their authority to rescind occupational licenses over unpaid loans: California, Hawaii, New Mexico, Texas, Louisiana, Mississippi, Georgia, Florida, Arkansas, Minnesota, Tennessee, Massachusetts, Iowa, and South Dakota, Iowa, and South Dakota. Moffie Funk learned that that was a potential consequence, she says she felt embarrassed.Currently, Massachusetts is one of many states that can deny, revoke, or refuse to renew any license if the holder defaults on a student loan. An Act prohibiting license revocation for student loan default. That's putting a lot of people's livelihoods at risk.īut Montana, where Lindley lives, is rolling those sanctions back. The percentage of Americans defaulting on their student loans has more than doubled since 2003.

Leaders of private, largely for-profit colleges that dont operate. RELATED: Florida Board of Health suspends health care licenses over student loan defaults. Its time for college leaders who fueled student loan crisis to pay up, Ed Department says. In 22 states, defaulters can have the professional licenses they need to do their jobs suspended or revoked if they fall behind in their student loan payments, licenses for things like nursing or engineering. Lawmakers are trying to end states' ability to suspend, revoke or deny licenses over debt. But had she defaulted longer, the state of Montana could have revoked her driver's license. Ultimately, lawmakers need to require licensing boards to become more. Nonsensical state laws yank licenses from student loan defaulters American Enterprise Institute - AEI Laws that revoke licenses after default are uniquely cruel, since defaulters. At the same time, it also distracts from more nuanced and narrowly targeted solutions for addressing the recent rise in student loan debt. That was motivation enough for Lindley to figure out ways to make her payments. By using occupational licenses in the service of debt collection, lawmakers make licensure an even more harmful labor market constraint.

'There was a time where I defaulted on my student loans enough that I never was sent to collections, but just long enough to, honestly, ruin my credit.' Clementine Lindley says she had a great college experience, but if she had it to do over again, she probably wouldn't pick an expensive private school. Since 2007, Montana has suspended the driver’s licenses of 92 people for defaulting on their student loans, according to John Barnes, a spokesman for the Montana attorney general’s office. Student debt in the United States has reached crisis levels. 'Removing my driver's license, you just created one more barrier for me being a productive citizen in my community.'įresh out of school, Lindley says there were times when she had to decide whether to pay rent, buy food or make her student loan payments. In Tennessee, people who default on their student loans are at risk of losing their licenses.