Letter to the Hon. Betsy DeVos, Secretary of Education - Serrano, Velázquez, Plaskett, González-Colón Send Letter Urging DeVos to Provide More Assistance for Student Loan Borrowers in Puerto Rico and U.S. Virgin Islands Affected by Hurricanes

Letter

Dear Secretary DeVos:

Puerto Rico and the U.S. Virgin Islands have recently experienced the worst natural disasters to hit the islands in almost a century. Shortly after these storms made landfall, the devastation has been so widespread, leaving most of the islands' residents without power, potable water, food, transportation, or the ability to communicate reliably with loved ones. The schools in Puerto Rico and the Virgin Islands were not spared from damage. Some schools are still inaccessible and others are still serving the over 9,100 refugees still living in shelters.

While other federal agencies continue to grapple with response efforts in order to save lives, restore power, and rebuild, the U.S. Department of Education must not forget its moral obligation to grant relief to the hundreds of thousands of Puerto Ricans and Virgin Islanders that currently hold a federal student loan.[1] To date, the Department has made little to no effort to provide any administrative reprieve to the islands' large population facing student loan repayment notices as they cope with the loss of loved ones, the destruction of their homes, work layoffs and furloughs.

The U.S. Department of Education released guidance on its website urging borrowers in the affected areas to call their student loan servicers to halt student loan payments temporarily- albeit, while interest continue to accrue.[2] To ensure borrowers are not accruing interest while in forbearance, we urge the Department to do more.

Under current regulation, subsidized loan borrowers who have deferred their loans due to economic hardship are not required to make payments of loan principal and interest does not accrue. On its website, the Department should urge borrowers to submit an economic hardship request. Additionally, the Secretary should send guidance to loan servicers advising them to tell all borrowers living in affected areas of this option.

Borrowers with unsubsidized loans can also benefit from an interest-free option. Under the Revised Pay As You Earn (REPAYE) repayment plan, the Department already provides an interest subsidy on unsubsidized loans. Under this benefit, up to half of the interest that accrues on unsubsidized loans during periods of negative amortization may be subsidized. It is possible that many borrowers do not know of this benefit and thus, may not request to switch plans. We urge you to notify borrowers of this benefit in REPAYE.

Additionally, we urge the Department to provide borrowers with any information in English and Spanish and require the servicers to have Spanish-speaking representatives available to serve these borrowers.

The lack of electricity and internet capabilities post-storm will significantly delay the take-up of these benefits. Given the inability of American citizens in Puerto Rico and the U.S. Virgin Islands to communicate with their servicers, the Department of Education should include in its request authority to automatically enroll all borrowers affected by Hurricanes Maria and Irma into forbearance. Moreover, while borrowers are in forbearance, interest should not be accruing. An interest-free mandatory administrative forbearance is the best way to ensure borrowers are not adversely affected during this difficult time.

The future of the people and economy in these U.S. territories depend on our complete and unequivocal support. We urge the Department of Education to do more to protect student loan borrowers as they continue to piece together their lives in the wake of devastation resulting from Hurricanes Maria and Irma. We thank you for your immediate response to this crisis and stand ready to help in any way that we can.

Sincerely,