Mills signs student loan bill of rights into law

Governor Janet Mill signing a bill surrounded by lawmakers.

Courtesy / Governor's office Gov. Janet Mills on Thursday signed LD 995, "An Act to Establish a Student Loan Bill of Rights to License and Regulate Student Loan Servicers."

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By Staff

Gov. Janet Mills on Thursday signed a student loan bill of rights into law aimed at protecting borrowers from predatory lending.

The measure, LD 995, "An Act to Establish a Student Loan Bill of Rights to License and Regulate Student Loan Services," was sponsored by state Sen. Eloise Vitelli, D-Arrowsic, and passed unanimously by the Legislature.

"Paying back student loan debt is difficult enough without a profit-hungry lender trying to make it harder and more expensive," said Mills. "By signing this bill into law, Maine is taking critical action to create oversight, implement accountability and protect the interests of our borrowers."

The move comes amid rising student debt levels in Maine and nationwide.

A recent report by Experian found that student loan debt in the United States climbed to record $1.4 trillion in the first quarter of this year, up from $1.3 trillion in 2018 and more than double what it was a decade ago.

In Maine, the average student loan debt has risen from $30,864 in 2018 to $32,521 this year, the report shows.

To protect student borrowers in Maine, the new bill of rights establishes a licensing procedure for lenders and prohibits them from employing any scheme, device or artifice to defraud or mislead borrowers.

It also creates a position of student loan ombudsman responsible for reviewing and, if possible, resolving complaints from borrowers, and requires lenders to comply with federal laws. It also allows state officials to investigate lenders who commit prohibited acts.

"Far too often, we hear horror stories of student loan servicers taking advantage of borrowers who are only trying to responsibly pay down their debt," said Vitelli, the assistant senate majority leader. "I'm grateful for the support this bill has received. I'm sure it will make a real difference in the lives of many Mainers."