Murray on New Report on Income-Driven Repayment System Failing Borrowers: It’s Time to Finally Fix Broken Student Loan System and Extend Payment Pause

Senator Murray: “This reporting makes crystal clear what I’ve already heard from so many struggling student borrowers in Washington state and across the country: our student loan system is seriously broken, it has been for years—and it must be fixed before borrowers are expected to start making payments again.”

(Washington, D.C.) – Today, U.S. Senator Patty Murray (D-WA), Chair of the Senate Health, Education, Labor, and Pensions (HELP) Committee, issued the following statement on fresh reporting that underscores the deep failure of the existing income-driven repayment system for student borrowers. 

“This reporting makes crystal clear what I’ve already heard from so many struggling student borrowers in Washington state and across the country: our student loan system is seriously broken, it has been for years—and it must be fixed before borrowers are expected to start making payments again. Income-driven repayment plans should be a lifeline that allow borrowers to work towards real relief—but it’s now clearer than ever that these plans have failed to provide a reliable pathway to the relief that millions of borrowers have been diligently working toward.

“It’s good to see the Department of Education has committed to addressing these egregious, long-running problems in order to rebuild trust and create a fair system that finally delivers on the promises made to borrowers. This is an urgent problem in need of real solutions: we need one workable IDR plan for all borrowers, and we need to ensure those who have been trapped in repayment for more than 20 years get the debt relief they are owed. I’ve made this clear to the Administration already, and these revelations just make this all the more urgent. And this is really critical—the Administration must extend the pause on student loan payments until 2023 because we cannot ask a single borrower to resume payments until this broken system is fixed.”

Last month, Senator Murray called on the Biden administration to extend the student loan payment pause until at least 2023 and use the extended pause to permanently fix the broken student loan system. In her statement, Senator Murray specifically outlined how the Administration must create a new, truly workable income-driven repayment (IDR) plan for all borrowers with a seamless enrollment plan that caps monthly payments at 10% of discretionary income and sunset previous IDR plans to end confusion. She also made clear that the Administration must provide immediate debt relief for borrowers, including those who have been trapped in repayment for 20 years—which can be done via an IDR waiver that ensures borrowers who’ve made monthly payments for 20 years are not stuck in a broken system for even longer.

Senator Murray has long led the charge to urge the Department of Education to improve and expand our existing student loan repayment and forgiveness programs to ensure borrowers can access affordable payments and debt relief. In 2021, Senator Murray urged Secretary Cardona to make key improvements to income-driven repayment (IDR), which she reiterated in her statement in March. She also led the call—alongside Senator Durbin and Senator Brown—to simplify and expand student discharge options, including for those on IDR plans. In that letter, she made clear that “the Department should ensure that borrowers who could be eligible for a loan discharge under current IDR plans, and any new streamlined IDR plan, have simplified and expanded access to such discharge. Prior payments on consolidation loans or under any federal student loan repayment plan, and all periods of deferment or forbearance other than an in-school deferment, should count for borrowers retroactively and prospectively toward the total cap on the number of years of their repayment obligation.” She reiterated this call for relief in her statement in March.

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