More laws when DOE already have rules and regulation for collection, from a Republican, The sponser Rep Tom Petri, (R, Wis) hasn;t read the conditions for government sponsered student loans. The guy is an idiot. He must believe in the nanny state and believe that US Gov can do a better job of collection than bill collection agencies.
Congress will consider overhauling debt collection in the $100 billion-a-year U.S. student loan program, replacing it with automatic withdrawals from borrowers’ paychecks tied to their income -- a system used in the U.K.
Legislation that Wisconsin Republican Representative Tom Petri plans to introduce as soon as this week would require employers to withhold payments from wages in the same way they do taxes. Payments would be capped at 15 percent of borrowers’ income after basic living expenses.
U.S. Representative Tom Petri's bill would require employers to withhold payments directly from borrowers’ paychecks in the same way they do taxes. Photographer: Troy Freund/Petri's Office via Bloomberg
U.S. President Barack Obama speaks about student-loan interest rates at the University of Nevada. Photographer: Isaac Brekken/Getty Images
The bill follows growing concern about the burden of $1 trillion in outstanding student loans, which now exceed credit- card debt. Under the new system, the government would no longer need to hire private debt-collection companies and charge fees that add as much as 25 percent to borrowers’ loan balances, leaving defaulted former students even deeper in the hole. ....
