Bill to split spousal student loans heads to House floor

The House Rules Committee on Monday advanced a bill allowing borrowers to sever spousal student loans, potentially making hundreds of additional Americans eligible for loan forgiveness. 

Democrats on the committee also focused on how the bill will finally allow individuals to leave the program in cases of divorce or domestic violence. 

“Victims of domestic violence or economic abuse should never have to pay the debts of their abuser,” said Chairman Jim McGovern (D-Mass.). “Closing this loophole is just common sense.” 

The bill was voted out of committee 7-3 and is expected to get a floor vote on Tuesday.

Nearly 15,000 people combined their student loans under the program between 1993 and 2006, with couples agreeing to be held liable for each other’s debts, according to The Washington Post. 

But there was no way to sever the joint debt under the program, leaving some people shouldering the debt of their exes — or abusers in some cases. 

About 770 loans have yet to be paid off, the Post reported. 

The Joint Consolidation Loan Separation Act would also make program participants eligible for the Public Service Loan Forgiveness program ahead of the Oct. 31 deadline for applications, as well as President Biden’s recently announced student loan forgiveness program providing up to $20,000 in forgiveness for federal borrowers making less than $125,000.

“This bill comes at a critical time as many borrowers seek relief under President Biden’s recently announced loan cancellation program,” said Rep. Bobby Scott (D-Va.)

“Simply put, by advancing the Joint Consolidation Loan Separation Act, we’re providing borrowers with additional avenues to seek loan relief.” 

GOP committee members expressed a number of concerns with the bill, including whether it could be enacted in time for participants to apply for forgiveness programs, and what they said was lack of specifics on how the debt would be passed on to both parties if the loans were separated. 

Rep. Virginia Foxx (R-N.C.) proposed an amendment addressing those concerns, which was voted down 7-3, with Democrats dismissing the GOP concerns. 

“This amendment is about derailing a bill to help victims of domestic abuse, that’s what it will do,” said McGovern. “It means that nothing gets done. It’ll mean there’ll be no relief, and I think that would be a huge mistake.” 

The bill passed unanimously in the Senate on June 15.