Reps. Garamendi and Fitzpatrick Reintroduce the Student Loan Refinancing and Recalculation Act

WASHINGTON, DC – Today, Representatives John Garamendi (D-CA08) and Brian K. Fitzpatrick (R-PA01) reintroduced the bipartisan “Student Loan Refinancing and Recalculation Act” (H.R.5710) to address the ballooning student loan debt crisis facing over 40 million American students and their families.

According to the White House, total student loan debt in America has reached over $1.6 trillion, approximately 92% of which is held by the federal government at interest rates of up to 8.05%. That percentage far exceeds the market rate for most other government loans.

The “Student Loan Refinancing and Recalculation Act” (H.R.5710) would allow students with federal loans to refinance their interest rates, lower future interest rates, eliminate origination fees on student loans, defer interest rate accrual for low-income and middle-class borrowers while they are pursuing their education, eliminate interest capitalization for federal student loans, and allow for borrowers in medical, dental, or veterinary residencies to defer payments until the completion of their program.

"The price of a college education is too high for most Americans. The average 2023 graduate owes more than $37,338 in student loan debt with many borrowers owing much more. This mountain of debt prevents graduates from reaching important milestones such as starting a family, buying a home, or opening their own business," said Garamendi. "Our bill would help to relieve some of the debt burden faced by American students and their families, while ensuring that the federal government is not making a profit on the backs of our students."

"To adequately prepare students for a 21st century job market, we need to revolutionize American education and job training. To do this, we must reduce barriers to educational opportunities and post-graduation success," said Fitzpatrick. "For too many, student loan debt is a crippling burden that impacts their involvement in our economy and achieving personal goals like owning a home, starting a family and supporting their community. The bipartisan Student Loan Refinancing and Recalculation Act is a step toward addressing this crisis."

"The University of California strongly supports U.S. Representative John Garamendi’s bill, the Student Loan Refinancing and Recalculation Act,” said Katherine S. Newman, University of California Provost. “We are committed to the goal of debt-free education for our students; this legislation would be a major step forward for UC graduates, especially those who have found it necessary to take on debt to complete their education. Our students would enjoy greater liberty to pursue an advanced degree, purchase a car or home, or start a family.  That is the kind of future we want for them and hence we commend Representative Garamendi for taking action to help UC graduates realize their ambitions.”

“The Higher Education Loan Coalition has long supported policies to create fairer loan terms that are market-driven for all borrowers, which is exactly what this legislation would do,” said Melissa Kunes, Chair of the Higher Education Loan Coalition. “Allowing current borrowers to refinance their loans, recalculating rates for future borrowers, and eliminating interest capitalization address key issues within the program to ensure borrowers are financially supported after graduation and help them pay down their principal balance in a timely manner. Such changes will have long lasting impacts on the student loan system and make college more affordable for all.”

“The American Dental Association thanks Rep. Garamendi for sponsoring the Student Loan Refinancing and Recalculation Act,” said George R. Shepley, D.D.S., President of the American Dental Association. “This bill will save young dentists tens of thousands of dollars in student loan interest. That financial freedom will open new career pathways for early career dentists to serve patients nationwide.”

“My support of this bill is rooted in my personal experiences and those that my fellow colleagues have been kind enough to share with me,” said Shafa Nathani,American Student Dental Association 2023-2024 President. “Our dentists are unwavering in their efforts to serve and advocate for their respective communities, and it is our duty to offer them the same level of support.”

The “Student Loan Refinancing and Recalculation Act” (H.R.5710) is endorsed by the Higher Education Loan Coalition, University of California, Academy of General Dentistry, American Dental Association, American Student Dental Association, American Association of Endodontists, American Academy of Periodontology, and American Veterinary Medical Association.

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