LMPV Testimony | Private Student Loans (SB21- 57)
Thank you Madame Chair. My name is Victoria Dadet, and I’m the Let My People Vote Coordinator for Soul 2 Soul Sisters where we organize for Black womxn’s healing, joy, and liberation here in Denver. I’m here to testify on behalf of our Let My People Vote program to urge you to support Senate Bill 57 and protect Black borrowers from the predatory practices of the private student loan industry.
According to the Student Borrower Protection Center, “Black borrowers are half as likely as white borrowers to use private student loans but are four times more likely to fall behind due to economic hardship.” So while Black borrowers use private student loans less, we face higher levels of challenges in repayment. Additionally, the gender wage gap creates challenges for women. While, nationally, women hold nearly two-thirds of the nation’s student loan debt, it’s Black womxn who often hold higher amounts of debt. And in Colorado, as the number of borrowers with student loans grow, it’s these marginalized communities who are impacted the most.
Currently, the private student loan industry lacks transparency, consistency, and equity – and this contributes to widening the intergenerational debt gap between Black families, other families of color, and white families. The lack of protections in the private student loan market are disproportionately impacting the most marginalized borrowers – especially Black borrowers. The lack of protections combined with the impacts of institutional racism – such as a lack of generational wealth – make it clear that the disparities we experience are driven by a legacy of slavery, racism, and constant attempts to prevent Black people from amassing wealth, power, and self determination in this country. So while student debt is getting unmanageable for all students in this country, Black students are hit the hardest.
Stronger private student loan protections allow us to address and mitigate the shady practices that put so many borrowers in financial distress. And seeing how the pandemic has increased these levels of distress, we can expect these practices to increase if we don’t do something about it right now. As has been stated by others, this bill will secure necessary protections for private student loan borrowers, bring more transparency and consistency to the repayment process, and ensure that there’s increased accountability for predatory players. While we acknowledge that one policy is not enough to meaningfully address the ways that our higher education system drives inequity, we believe that we can take critical steps now with legislation to protect borrowers, mitigate economic exploitation and harm, and get closer to securing justice for Black communities. This bill is one of those critical steps we must take to create a more equitable economy that works for everyone, not just the wealthy and privileged.
The student debt crisis is absolutely out of control and it’s clear that we need to make major changes to address it. And we need to start by centering our Black students because we know that when we center the needs of the most marginalized, we can get closer to addressing the root causes of these problems. Any change we make must support the work of creating a more equitable society, and we believe this bill helps us to reach that goal. Thank you for your time today and I urge you all to vote yes on Senate Bill 57.