[Pages H7993-H7998]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

JOINT CONSOLIDATION LOAN SEPARATION ACT

Mr. SCOTT of Virginia. Mr. Speaker, pursuant to House Resolution
1361, I call up the bill (S. 1098) to amend the Higher Education Act of
1965 to authorize borrowers to separate joint consolidation loans and
ask for its immediate consideration.
The Clerk read the title of the bill.
The SPEAKER pro tempore. Pursuant to House Resolution 1361, the bill
is considered read.
The text of the bill is as follows:

S. 1098

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Joint Consolidation Loan
Separation Act''.

SEC. 2. SEPARATING JOINT CONSOLIDATION LOANS.

(a) In General.--Section 455(g) of the Higher Education Act
of 1965 (20 U.S.C. 1087e(g)) is amended--
(1) by striking ``A borrower'' and inserting the following:
``(1) In general.--A borrower''; and
(2) by adding at the end the following:
``(2) Separating joint consolidation loans.--
``(A) In general.--
``(i) Authorization.--A married couple, or 2 individuals
who were previously a married couple, and who received a
joint consolidation loan as such married couple under
subparagraph (C) of section 428C(a)(3) (as such subparagraph
was in effect on June 30, 2006), may apply to the Secretary,
in accordance with subparagraph (C) of this paragraph, for
each individual borrower in the married couple (or previously
married couple) to receive a separate Federal Direct
Consolidation Loan under this part.
``(ii) Eligibility for borrowers in default.--
Notwithstanding any other provision of this Act, a married
couple, or 2 individuals who were previously a married
couple, who are in default on a joint consolidation loan may
be eligible to receive a separate Federal Direct
Consolidation Loan under this part in accordance with this
paragraph.
``(B) Secretarial requirements.--Notwithstanding section
428C(a)(3)(A) or any other provision of law, for each
individual borrower who applies under subparagraph (A), the
Secretary shall--
``(i) make a separate Federal Direct Consolidation Loan
under this part that--

``(I) shall be for an amount equal to the product of--

``(aa) the unpaid principal and accrued unpaid interest of
the joint consolidation loan (as of the date that is the day
before such separate consolidation loan is made) and any
outstanding charges and fees with respect to such loan; and

[[Page H7994]]

``(bb) the percentage of the joint consolidation loan
attributable to the loans of the individual borrower for whom
such separate consolidation loan is being made, as
determined--
``(AA) on the basis of the loan obligations of such
borrower with respect to such joint consolidation loan (as of
the date such joint consolidation loan was made); or
``(BB) in the case in which both borrowers request, on the
basis of proportions outlined in a divorce decree, court
order, or settlement agreement; and

``(II) has the same rate of interest as the joint
consolidation loan (as of the date that is the day before
such separate consolidation loan is made); and

``(ii) in a timely manner, notify each individual borrower
that the joint consolidation loan had been repaid and of the
terms and conditions of their new loans.
``(C) Application for separate direct consolidation loan.--
``(i) Joint application.--Except as provided in clause
(ii), to receive separate consolidation loans under this
part, both individual borrowers in a married couple (or
previously married couple) shall jointly apply under
subparagraph (A).
``(ii) Separate application.--An individual borrower in a
married couple (or previously married couple) may apply for a
separate consolidation loan under subparagraph (A) separately
and without regard to whether or when the other individual
borrower in the married couple (or previously married couple)
applies under subparagraph (A), in a case in which--

``(I) the individual borrower certifies to the Secretary
that such borrower--

``(aa) has experienced an act of domestic violence (as
defined in section 40002 of the Violence Against Women Act of
1994 (34 U.S.C. 12291) from the other individual borrower;
``(bb) has experienced economic abuse (as defined in
section 40002 of the Violence Against Women Act of 1994 (34
U.S.C. 12291) from the other individual borrower; or
``(cc) is unable to reasonably reach or access the loan
information of the other individual borrower; or

``(II) the Secretary determines that authorizing each
individual borrower to apply separately under subparagraph
(A) would be in the best fiscal interests of the Federal
Government.

``(iii) Remaining obligation from separate application.--In
the case of an individual borrower who receives a separate
consolidation loan due to the circumstances described in
clause (ii), the other non-applying individual borrower shall
become solely liable for the remaining balance of the joint
consolidation loan.''.
(b) Conforming Amendment.--Section 428C(a)(3)(B)(i)(V) of
the Higher Education Act of 1965 (20 U.S.C. 1078-
3(3)(B)(i)(V)) is amended--
(1) by striking ``or'' at the end of item (bb);
(2) by striking the period at the end of item (cc) and
inserting ``; or''; and
(3) by adding at the end the following:
``(dd) for the purpose of separating a joint consolidation
loan into 2 separate Federal Direct Consolidation Loans under
section 455(g)(2).''.

The SPEAKER pro tempore. The bill shall be debatable for 1 hour,
equally divided and controlled by the chair and ranking minority member
of the Committee on Education and Labor or their respective designees.
The gentleman from Virginia (Mr. Scott) and the gentlewoman from
North Carolina (Ms. Foxx) each will control 30 minutes.
The Chair recognizes the gentleman from Virginia (Mr. Scott).

General Leave

Mr. SCOTT of Virginia. Mr. Speaker, I ask unanimous consent that all
Members may have 5 legislative days in which to revise and extend their
remarks and insert extraneous material on S. 1098.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Virginia?
There was no objection.
Mr. SCOTT of Virginia. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, I am pleased to rise in support of the bipartisan,
bicameral Joint Consolidation Loan Separation Act, led in the Senate by
my colleague from Virginia, Senator Mark Warner, and led in the House
by the gentleman from North Carolina (Mr. Price).
Student loans should provide a pathway to opportunity, not saddle
borrowers with a lifetime of burdensome debt, especially if the loans
don't even belong to them.
Regrettably, many borrowers' financial well-being has been made worse
by student loans jointly held by their spouse or former spouse.
The Joint Consolidation Loan Separation Act would provide much-needed
relief for individuals who previously consolidated their student loans
with their spouse. Although Congress eliminated the joint consolidation
loan program in 2006, it did not provide a way for borrowers to sever
existing loans, even in the event of domestic violence, domestic abuse,
or unresponsiveness from a former spouse after a divorce.
As a result, according to the most recent data from the Department of
Education, there are at least 13,500 borrowers with federally held
joint consolidation loans.
The Joint Consolidation Loan Separation Act would allow borrowers to
submit an application to the Department of Education to split the joint
consolidation loan into two separate Federal direct loans. The two new
Federal direct loans would be split proportionally based on the
original unpaid principal and have the same interest rates as the joint
consolidation loan, ensuring borrowers are not saddled with a higher
interest rate.
Importantly, the bill provides a pathway for an individual to apply
to separate a loan from a spouse, a current spouse or former spouse,
including in the event of an absentee or unresponsive spouse, for an
act of violence or economic abuse.
Mr. Speaker, we can all agree that no borrower should be forced to
pay a debt that isn't theirs, especially the debt of an abusive former
spouse.
Mr. Speaker, I urge my colleagues to support this legislation, and I
reserve the balance of my time.
Ms. FOXX. Mr. Speaker, I yield myself such time as I may consume, and
I thank my colleague for yielding the time.
While I fully support the underlying intent of S. 1098, the Joint
Consolidation Loan Separation Act, I have concerns about the bill as
drafted. The purpose of this bill is to protect student loan borrowers
who consolidated their loans with a spouse but now seek to reverse this
process. Yet, as written, this bill undermines that purpose.
I am concerned this bill will hurt the very borrowers we are trying
to help. We never want to see a spouse, especially one that is a victim
of domestic violence, forced to be financially tied to his or her
abuser. We want to give these borrowers a way out. However, we also
recognize that it is not only the abused spouse who may be applying for
these new consolidations.
Under the Senate-passed language, when a borrower files for a new
consolidated loan, he or she could potentially leave his or her spouse
with the remaining balance. We must be cognizant of the fact that a
borrower could use this new legislation as a weapon. This is why we
need safeguards in place to ensure that both parties are not subject to
potential abuse through the separation process and not just the one
filing for a new consolidation.
Additionally, the Department of Education has stated that it will
take 12 to 18 months to implement this bill. Given the urgency of the
situation that many borrowers are in, this kind of delay is
unacceptable. We need to provide these borrowers with a quicker way out
of their joint consolidation loan. Yet, Democrats rejected the
Republicans' solution that will give these borrowers an almost
immediate separation without unnecessary paperwork that will bog down
the process.
Further, I am concerned that this bill could be used by the Secretary
of Education to stage an even broader takeover of student loans. It
would be simpler and more straightforward to allow these loans, once
separated, to remain with their current holder, but instead, this
legislation attempts to drive as many of these loans as possible into
the government-run Direct Loan program.
We have ample evidence to believe that the Biden Department of
Education will take the inch given in this legislation and use it to go
a mile. The administration's illegal expansion of the income-driven
repayment program and Public Service Loan Forgiveness program, let
alone Biden's student loan bailout, are evidence of that.
For example, the vague language included in this bill, namely, the
authority for the Secretary of Education to allow for new consolidation
loans if it is in ``the fiscal interest of the Federal Government.''
The Department of Education has not been able to provide clarity on
what this phrase means or how it applies to this bill, but it has been
used previously by this administration to force billions of dollars'
worth of loans made by private lenders

[[Page H7995]]

onto the government's books. Moreover, the President's $1 trillion
transfer of wealth from hardworking taxpayers to college
graduates clearly illustrates this administration had no intention of
protecting ``the fiscal interests of the Federal Government.''

We must not create any loopholes or back doors for the Biden
administration to exploit. Transferring massive amounts of student loan
debt to taxpayers is harming our economy and setting a horrible
precedent for future borrowers, not to mention failing to solve the
underlying problems in postsecondary education.
Because of these issues, Republicans have a solution that will allow
student loan servicers to separate joint consolidation loans almost
immediately, instead of having to wait over a year to receive relief.
Our solution is a commonsense and practical way to accomplish the
same goal as this legislation but more quickly and efficiently.
Republicans are willing to work across the aisle to ensure borrowers
are taken care of, but unfortunately, Democrats are more focused on
opening more avenues for the administration to expand its radical loan
bailout.
Mr. Speaker, I reserve the balance of my time.
Mr. SCOTT of Virginia. Mr. Speaker, I yield 7 minutes to the
gentleman from North Carolina (Mr. Price), the House sponsor of the
legislation.
Mr. PRICE of North Carolina. Mr. Speaker, I am happy to rise in
support of S. 1098, the Joint Consolidation Loan Separation Act.
I am the author of the House version of this bill and have introduced
it every Congress since the 115th, always with a Republican cosponsor.
I would like to start my remarks today by thanking the Members, past
and present, who have helped bring us to the floor today.
I thank our former colleague Bradley Byrne of Alabama for his
cosponsorship of the first iteration of this bill. I thank
Congresswoman Haley Stevens and other current bipartisan cosponsors;
Senators Mark Warner, Marco Rubio, and John Cornyn, who recently
steered this bill to passage in the Senate; and my colleague from North
Carolina, Senator Richard Burr, who expedited the review of this bill
by his committee.
This bill passed the Senate by unanimous consent on June 15 of this
year.
I also thank my good friend Chairman Bobby Scott and his staff. They
have vetted this bill and worked over this bill very carefully. He is
an outstanding leader of the committee, and he has been a longstanding
supporter of this bill. He included it, in fact, in various versions of
the Higher Education Act.
I also thank the staff, entrepreneurial staff, who picked up on this
problem from casework years ago and devised a legislative solution.
That would be Kate Roetzer and Nora Blalock of my staff initially,
Janssen White and Elizabeth Adkins more recently, and other personal
and committee staff, House and Senate.
Thanks, too, to the advocates, people affected by this problem, who
have come to our offices and our town meetings and relentlessly
advocated for relief. A number of these advocates are our guests in the
gallery today.
The Joint Consolidation Loan Separation Act, or JCL for short, is
simple in its intent but significant in its impact on thousands of
student loan borrowers who have waited for relief for far too long.
From 1993 to 2006, the U.S. Department of Education issued joint
consolidation loans to married couples where both borrowers agreed at
the time to be jointly liable for repayment. As you might expect, this
proved problematic if that couple ever needed or wanted to separate the
loans.
Congress wisely eliminated this program in 2006 but with one critical
oversight: Congress did not provide a means of severing the existing
loans, even in the event of domestic abuse, economic abuse, or an
unresponsive partner. There was, in other words, no grandfather clause.
As a result, there are borrowers nationwide who remain financially
liable for their absconded or abusive or uncommunicative spouse's
portion of their consolidated debt with no legal options for relief.
The bill before us would allow such borrowers to submit an
application to the Department of Education to split the joint
consolidated loan into two separate Federal direct loans. The joint
loan remainder would be split proportionately based on the percentage
that each borrower originally brought into the loan.
It was an unfortunate mistake not to grandfather in the severing of
these loans with the 2006 cancellation of the program, so this bill is
a long overdue, commonsense correction. Congress does occasionally make
mistakes; in case we hadn't noticed.
Let me just illustrate to you what the solution means for the lives
of borrowers.
I first became aware of this issue in 2014, 8 years ago, through
constituent casework. My constituent consolidated his $25,000 loan with
his ex-wife's $75,000 loan. After their divorce, the Department
continued to collect on the combined loan from both parties, even
though my constituent had paid off his portion of the loan. That is
just one of the many examples that cover the spectrum of unpleasant
situations with this shared debt.
Let's assume that one partner attended community college and the
other an expensive private school, and their loan amounts are vastly
different. When they consolidated their loans, they both agreed to be
jointly liable for repayment. But say the partner who attended private
school became unresponsive and stopped paying into the loan. That left
the partner who attended community college saddled with their total
debt, along with the partner's private school education cost.

{time} 1445

We have also heard horror stories of couples who have survived
abusive relationships but continue to remain tied to their partners
through the loan. Former partners have exerted financial abuse by
refusing to copay with their exes. In other instances, individuals are
unable to get in contact with the copartner of their loan and are
similarly left to shoulder the debt all by themselves.
These borrowers have seen their wages garnished and their credit
scores ruined to the point where they cannot assist their own children
in taking care of Federal student loans. This has become a generational
impact.
These loan holders are often in punishing situations with no hope in
sight for action to fix this mistake unless we pass the bill before us
today.
This bill has been thoroughly vetted by the Department of Education,
the House Committee on Education and Labor, and numerous checkpoints in
the Senate. It passed by unanimous consent in the Senate a few short
months ago. We have made accommodations all along the way, including
Republican changes that I did not prefer, for the sake of getting the
bill to the floor in both Chambers. With tomorrow's vote, it will go
directly to the President's desk.
This is a bipartisan, bicameral piece of legislation. I believe it is
the end product of a fair process that has withstood the rigors of
legislative scrutiny. As far as legislative impact goes, this one is
simple but profound in its impact on borrowers.
The Joint Consolidation Loan Separation Act presents a rare
opportunity for Congress to right a wrong, to correct an omission in
its own legislative process. I urge that we do so. The bill offers a
fair and equitable relief to borrowers who have suffered great
hardship, and I urge my colleagues to vote ``yes.''
Ms. FOXX. Mr. Speaker, I yield 3 minutes to the gentleman from
Virginia (Mr. Good).
Mr. GOOD of Virginia. Mr. Speaker, I rise in opposition to S. 1098,
which expands the Secretary of Education's already illegitimate,
unconstitutional authority, so-called, to transfer student loan debt
from those who borrowed it to those who did not.
How egregious, once again, that we would try to force taxpayers who
did not go to college, who worked their way through college without
incurring debt, or who paid off their student loans to now have to
carry the debt for those making up to $250,000 a year, from a family
standpoint.
This is an effort to double the number of student loans where the
debt will be transferred to hardworking taxpayers. This bill allows new
authority

[[Page H7996]]

for the Secretary of Education to allow for new loans if it is in the
``fiscal interests of the Federal Government.''
Now, that is an interesting concept. Since when does this majority
consider the fiscal impact of their decisions?
There is no limit to how many illegals they will allow to invade our
country through the southern border, and there is no limit, seemingly,
to how much money they will spend. The answer to every supposed problem
is to spend more money, irrespective of the fiscal impact.
Instead of considering the fiscal impact on the Federal Government,
by the way, which I suspect we will not do since the Federal Government
doesn't have any money, since the Federal Government is in debt for $31
trillion, which is $90,000 per citizen, how about if we consider the
fiscal impact on the taxpayers who are on the hook for that $31
trillion and will be on the hook for this new spending that is being
advocated for today?
The truth is this bill, this legislation, would add billions more to
the already terrible decisions we have made fiscally in this Congress.
The majority's response to the $31 trillion national debt that we have
already referenced most recently is to pass their inflation increase
bill. That added $800 billion more in spending, half of it for green
raw deal spending, a couple hundred billion dollars for IRS agents,
because I am sure you hear all across your district, like I do, that
the only thing we need is more IRS agents.
Then, our other response, in addition to the inflation increase act,
is to the student loan transfer fiasco, transferring debt from those
who borrowed it to those who did not. Today, we will add billions more
to that $600 billion conservative estimate on what the cost is of the
student loan transfer scheme.
Mr. Speaker, I urge all of my colleagues to oppose this bill.
Mr. SCOTT of Virginia. Mr. Speaker, prior to yielding time, I yield
myself 1 minute just to remind those on the other side of the aisle,
who have lectured this side of the aisle on fiscal responsibility, that
every Democratic Presidential administration since Kennedy left office
with a better deficit situation than they inherited--every one, without
exception. And every Republican since Nixon, every administration left
office with a worse deficit situation than they inherited, without
exception. President Trump was well on his way to fulfilling that trend
before the pandemic.
But hypocrisy is not much of an issue. I just wanted to remind people
who is fiscally responsible and who isn't.
Mr. Speaker, I yield 1 minute to the gentlewoman from Michigan (Ms.
Stevens), a distinguished member of the Committee on Education and
Labor and an original cosponsor of this legislation.
Ms. STEVENS. Mr. Speaker, in that vein, some of us are here to
pontificate, and others of us are here to solve problems.

I rise today for those who have been the victim of this oversight.
From the period of 1993 to 2006, Americans filed for the consolidation
of student loans, not realizing that they may fall prey to an
unfortunate situation: domestic abuse; economic abuse; an unresponsive
partner; or divorce, which plagues 50 percent of this population.
Under the leadership of my friend and colleague, Congressman Price,
we have a solution. We have a bill, the Joint Consolidation Loan
Separation Act, which is bipartisan and which we should pass to help
people.
To those who have been victims--and I consider you victims--we offer
our extension of empathy, but we also offer our extension of a
solution. We have a good program here to allow you to reengage with the
Department of Education to make sure that you have fairness with your
loan.
Mr. Speaker, I urge my colleagues to come together to pass this bill.
Ms. FOXX. Mr. Speaker, I yield 2 minutes to the gentleman from North
Carolina (Mr. Murphy).
Mr. MURPHY of North Carolina. Mr. Speaker, first and foremost, I want
to say how deeply I appreciate Mr. Price's hard work over the last
couple of years on S. 1098. I thank him very much for his efforts on
this key and very bipartisan issue.
It is clear that there is bipartisan support that victims of spousal
abuse should be able to sever these consolidation loans without penalty
or delay. I don't think that is the question. The question here is the
change in the calculus because of what President Biden has done.
While I support the intention of this bill to separate these loans,
President Biden's unconstitutional, only-able-to-be-done-because-of-
his-abuse-of-power student loan giveaway has drastically changed the
context in which we consider this bill. The President, in his actions,
has undermined what was a clear bipartisan effort.
S. 1098 gives the administration the authority and creates a pathway
which could be used for loan forgiveness, again taking money from
people who didn't benefit from a college education and making those
individuals pay for it.
Once these loans are separated into the Direct Loan Program, these
loans will be eligible for Biden's near-trillion-dollar student loan
giveaway. Republicans made a good-faith effort to amend this
legislation to protect taxpayers, but Democrats refused to close this
loan forgiveness loophole.
Our Republican solution, the Simplified Joint Consolidation
Separation Act, will allow borrowers to separate their loans in a more
timely manner to expedite financial freedom while protecting taxpayers
by focusing on the administration's authority to directly aid those
most in need.
This targeted, commonsense legislation should garner immediate
support from both sides of the aisle and will actually correct the
issue that we all want solved.
The SPEAKER pro tempore (Mr. Tonko). Members are reminded to refrain
from engaging in personalities toward the President.
Mr. SCOTT of Virginia. Mr. Speaker, would the Speaker advise how much
time is remaining on both sides.
The SPEAKER pro tempore. The gentleman from Virginia has 19 minutes
remaining. The gentlewoman from North Carolina has 20 minutes
remaining.
Mr. SCOTT of Virginia. Mr. Speaker, I yield 3 minutes to the
gentlewoman from Texas (Ms. Jackson Lee).
Ms. JACKSON LEE. Mr. Speaker, I thank the chairman of the full
committee, Mr. Scott, for continuing to find ways to collaborate with
his members and others to ensure that we respond to the crux of
opportunity in America, and that is education.
I am so grateful to be able to stand and support S. 1098 and to take
this brief moment to thank my fellow alum, David Price, for being
persistent in this legislation and serving the American people over the
years that he has done. I had a chance to get a second bite of the
apple. David was here and then came back. I have enjoyed every moment
of his commitment to opportunities for Americans over the years,
including housing and transportation and homeland security, and I
certainly want to say to him that the American people are better for
his service to this Nation. I thank him so very much.
I am grateful to finally be able to say, Chairman Scott, to a
constituent who I saw over the weekend that called the number of the
bill--most times, constituents don't know bill numbers. They said: ``I
need you to support S. 1098.'' Obviously, this is something so many of
us have been looking to because we have heard this from our
constituents.
I am very grateful that this legislation now allows a married couple
who has previously consolidated their Federal student loans, because we
were allowed to do that--many people thought that was a good thing to
do, to submit a joint application to the Department of Education to
sever their loan, allowing each former spouse their proportional
responsibility. Each former spouse would still be obligated for a share
of the loan, but their share of responsibility would be benchmarked to
the proportion of the debt that they brought into the consolidated
loan. Without loan severance, if a spouse refused to pay their share,
the other spouse remains responsible for full payment.

This is important legislation as it relates to divorce and domestic
violence or economic abuse. Bearing the risk of the full responsibility
for a consolidated loan after divorce can dramatically restrain a
spouse from moving on with their life, from supporting their children,
from getting a house, from feeling safe.

[[Page H7997]]

The Joint Consolidation Loan Separation Act also addresses the
especially volatile situation of former relationships in which an
individual was subjected to domestic or, as I said, economic abuse.
As a sponsor of the Violence Against Women Act that became law in
March of last year, I am especially concerned about women who have
experienced physical, mental, sexual, emotional, even psychological
abuse at the hands of a spouse or partner. S. 1098 allows them to
separate from toxic relationships, get away from the economic abuse,
and retain or maintain their credit so that they can go forward. This
can also apply to a male who may be suffering from the same situation.
Two married borrowers of Federal student loans could combine their
debt into a single loan, but we can also come back now to ensure that
they can separate it. This is an important step forward.
The SPEAKER pro tempore. The time of the gentlewoman has expired.
Mr. SCOTT of Virginia. Mr. Speaker, I yield an additional 1 minute to
the gentlewoman.
Ms. JACKSON LEE. Mr. Speaker, we enthusiastically add this to the
component of making sure, under the Violence Against Women Act, that
there is an expanded understanding of what happens when one spouse
abuses another or the idea of economic abuse.

{time} 1500

Just as an example, when one spouse is not being timely, is not being
responsive, for whatever reason is not able to be found, then the
credit of the remaining spouse being dutiful is completely, if I might
use the term, mutilated.
I am eager to ensure that this bill is passed. I certainly
acknowledge the Senator from the State of Texas, Senator Cornyn. We
have worked together on other matters.
I will let everybody know this bill is bipartisan, and I will let
everyone know that what we will be doing is ensuring that people can
restore their lives. They can stand up again and be able to pay their
debt.
As I finish, I am stunned by people who don't want to see us move
forward for people to pay their debt. They can pay their debt. Let us
all support S. 1098.
Mr. Speaker, I rise in support of S. 1098, the Joint Consolidation
Loan Separation Act allowing a jointly-held loan debt to be separated.
This legislation would allow a married couple, who had previously
consolidation their federal student loan debts, to submit a joint
application to the Department of Education to sever their loan,
allotting to each former spouse their proportional responsibility.
While each former spouse would still be obligated for a share of the
loan, their share of responsibility would be benchmarked to the
proportion of debt that they brought into the consolidated loan.
Without loan severance, if a spouse refuses to pay their share of the
loan, the other spouse remains responsible for full payment.
This is very important legislation because it is a key to
independence following a divorce. Without being able to sever their
loan obligation after divorce, people are forced to continue
interacting with their former spouse.
Bearing the risk of full responsibility for a consolidated loan after
divorce can dramatically restrain a spouse from moving on with their
life, both financially and emotionally, as they are forced to maintain
communication with someone from whom they no longer want to be closely
associated.
The Joint Consolidation Loan Separation Act also addresses the
especially volatile situation of former relationships in which an
individual was subjected to domestic or economic abuse from the other
individual.
As the sponsor of the Violence Against Women Act Reauthorization Act
that became law in March of this year, I am especially concerned about
women who have experienced physical, mental, sexual, emotional, or
psychological abuse at the hands of a spouse or partner.
Thus, it is especially important that S. 1098 make it easy for women
who have suffered from abuse to sever their loans, to help them sever
their toxic relationships.
Indeed, S. 1098 allows one borrower to submit a separate application
in the event that the individual has experienced domestic or economic
abuse from the other individual borrower or is unable to reasonably
access the loan information of the other borrower.
In the case of this occurring, the other non-applying individual
borrower shall become solely liable for the remaining balance of the
joint consolidation loan.
Joint consolidation loans were first created for the good of
Americans to combat growing default rates.
Two married borrowers of federal student loans could combine their
debt into a single loan.
While the legislation was intended to proactively accommodate these
life situations, joint consolidation forms came with no guidance from
the Department of Education for cases of domestic or economic abuse.
A divorce decree could not remove one spouse from the debt, nor could
have any other agreement as both people were now legally responsible
for the combined debt.
If an ex-spouse refused to pay their share of the monthly payment,
the other spouse would have to make the entire payment themselves.
If a former couple wanted to make their student loan payments under a
payment plan, both spouses would need to pay the loan under the same
plan and provide their financial information.
If one of them failed to do so, they would both be denied access to
the payment plan.
Because of all these loopholes, Congress eliminated access to joint
consolidation loan applications in 2006.
However, it did not provide a way to separate responsibility for
existing loans, even in cases of domestic violence, economic abuse, or
an unresponsive partner.
With the Joint Consolidation Loan Separation Act, we can now provide
a way out for those facing domestic violence or economic abuse, as
victims in this position face challenges beyond their own control.
As reported by the CDC, about 1 in 4 women and nearly 1 in 10 men
have experienced physical or sexual violence by an intimate partner
during their lifetime.
According to the National Coalition Against Domestic Violence,
between 94 and 99 percent of domestic violence survivors have also
experienced economic abuse, which includes coerced debt and withholding
access to money.
There are currently 776 borrowers with spousal consolidation loans,
according to the Student Borrower Protection Center.
It is our responsibility to do right for these borrowers who fell
victim to the consequences of previous legislation.
As the sponsor of H.R. 1620, the Violence Against Women Act
Reauthorization Act, I proudly support S. 1098's efforts to provide
options for victims of violence, especially for women who are at a
significantly higher risk.
Ms. FOXX. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, my amendment to S. 1098 would establish a more efficient
process for separating joint consolidation loans to ensure timely
relief for borrowers, protect victims of abuse seeking to sever their
financial entanglement with their abuser, and protect taxpayers by
ensuring that the Secretary's authority is narrowly tailored to help
those in need.
It allows borrowers to separate their loans immediately rather than
having to apply for a new loan in the Direct Loan Program, a process
that can take as long as 18 months to implement.
Moreover, it ensures that those who are victims of economic or
domestic abuse can split their loans without opening up avenues for
their abuser to game the system and inflict further harm on those we
are trying to help.
This is a commonsense fix to a bill that all of us agree is well-
intended but falls short of ensuring adequate safeguards for borrowers.
S. 1098 also fails to protect against the abuse of executive
authority, something this administration has already proven it will
happily do.
If we adopt the motion to commit, we will instruct the Committee on
Education and Labor to consider my amendment to S. 1098 to establish a
more efficient process for separating joint consolidation loans to
ensure timely relief for borrowers that need it.
I ask unanimous consent to insert the text of the amendment in the
Record immediately prior to the vote on the motion to commit.
The SPEAKER pro tempore. Is there objection to the request of the
gentlewoman from North Carolina?
There was no objection.
Ms. FOXX. Mr. Speaker, I urge my colleagues to pass the amendment so
we can provide timely relief to the borrowers who need it, and I
reserve the balance of my time.
Mr. SCOTT of Virginia. Mr. Speaker, I yield 2 minutes to the
gentleman from Texas (Mr. Green).
Mr. GREEN of Texas. Mr. Speaker, I thank Mr. Scott, as well, for the
outstanding job that he has done.
Mr. Price, I don't know what more you can do. I really don't. This
bill is

[[Page H7998]]

bipartisan; it is bicameral; and, by God, we ought to pass it.
Ms. FOXX. Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, I urge my colleagues to consider the solution
Republicans have put on the table. Borrowers wanting out of joint
consolidated loans should have the opportunity to separate, but the
method we use to get this done is important.
S. 1098, the Joint Consolidation Loan Separation Act, will take the
Department 12 to 18 months to implement, far too long for some
borrowers who are in urgent need of help. This legislation could also
backfire on the very borrowers we are all working to help.
Additionally, this bill's sloppy and vague language could pave the
way for even more Federal power grabs over the student loan system.
Given what we have seen from this administration, we cannot open any
doors to further student loan debt schemes.
Bottom line, S. 1098 delays support for borrowers who need assistance
immediately, cedes more control to the Education Secretary, and fails
to protect the borrowers and taxpayers.
Mr. Speaker, I urge my colleagues to oppose this legislation, and I
yield back the balance of my time.
Mr. SCOTT of Virginia. Mr. Speaker, I yield myself the balance of my
time.
Mr. Speaker, while the Joint Consolidation Loan Separation Act does
not solve the student loan debt crisis, it takes another sensible step
to help borrowers separate with loans that do not belong to them. This
legislation also comes at a critical time when many borrowers seek
relief under President Biden's recently announced loan cancellation
program.
Unfortunately, not all borrowers with joint consolidation loans are
currently eligible for relief, even if they meet all other criteria.
Simply put, by advancing the Joint Consolidation Loan Separation Act,
we are providing borrowers with additional avenues of loan relief,
ensuring survivors of domestic or economic abuse are not responsible
for their spouse's or former spouse's debt.
Again, I thank Senator Warner of Virginia and the gentleman from
North Carolina (Mr. Price) for their leadership on this legislation.
Mr. Speaker, I ask my colleagues to support the legislation, and I
yield back the balance of my time.
The SPEAKER pro tempore. Pursuant to House Resolution 1361, the
previous question is ordered on the bill.
The question is on the third reading of the bill.
The bill was ordered to be read a third time, and was read the third
time.

Motion to Commit

Ms. FOXX. Mr. Speaker, I have a motion to commit at the desk.
The SPEAKER pro tempore. The Clerk will report the motion to commit.
The Clerk read as follows:

Ms. Foxx moves to commit the bill (S. 1098) to the
Committee on Education and Labor.

The material previously referred to by Ms. Foxx is as follows:

Strike all after the enacting clause and insert the
following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Joint Consolidation Loan
Separation Act''.

SEC. 2. AUTHORIZATION OF GUIDANCE TO SEPARATE JOINT
CONSOLIDATION LOANS.

Section 428C of the Higher Education Act of 1965 (20 U.S.C.
1078-3) is amended--
(1) in subsection (a)(3)(B)(i)--
(A) by striking ``and'' at the end of subclause (IV);
(B) by striking the period at the end of subclause (V) and
inserting ``; and''; and
(C) by adding at the end the following:

``(VI) separation of a joint consolidation loan into
individual consolidation loans in accordance with subsection
(g) shall not be considered receipt of a consolidation loan
for purposes of this clause, and an individual's status as an
eligible borrower shall not change solely as a result of such
a separation.''; and

(2) by adding at the end the following:
``(g) Secretary Guidance on Joint Consolidation Loans.--
``(1) In general.--
``(A) Authorization.--Notwithstanding section 421(d), a
married couple, or two individuals who were previously
married and received a joint consolidation loan under
subsection (a)(3)(C) (as such subsection was in effect on
June 30, 2006), may jointly request the Secretary or holder,
in accordance with paragraph (2), to separate the existing
joint consolidation loan into two individual consolidation
loans.
``(B) Eligibility for borrowers in default.--A married
couple, or two individuals who were previously a married
couple, who received a joint consolidation loan described in
subparagraph (A) and are in default on such joint
consolidation loan may both be eligible for separation of
such joint consolidation loan into two individual
consolidation loans in accordance with this subsection.
``(C) Eligibility for individual requests.--
``(i) Circumstances allowing for separate application.--An
individual who is one of the parties who received a joint
consolidation loan described in subparagraph (A) may,
separately and without regard to whether or when the other
individual borrower who received such joint consolidation
loan applies under subparagraph (A), request separation of
such joint consolidation loan into two individual
consolidation loans in accordance with this subsection in a
case in which the requesting individual borrower certifies to
the Secretary that such borrower--

``(I) has experienced an act of domestic violence from the
other individual borrower;
``(II) has experienced an act of economic abuse from the
other individual borrower; or
``(III) is subject to a divorce decree, court order, or
settlement agreement requiring the separation of joint loans
and obligations.

``(ii) Obligation from separate application.--In the case
of a joint consolidation loan that is separated upon request
of an individual borrower due to one or more circumstances
described in clause (i), the other non-applying individual
borrower shall be liable for the outstanding balance of the
individual consolidation loan of such borrower in the same
manner as if both borrowers of the joint consolidation loan
had applied for such separation.
``(2) Secretarial and holder requirements.--Notwithstanding
subsection (a)(3)(A) or any other provision of law, the
Secretary or holder may separate the joint consolidation loan
for eligible borrowers who meet the eligibility requirements
specified in paragraph (1). The two separate individual
consolidation loans shall--
``(A) be for an amount equal to the product of--
``(i) the unpaid principal and accrued unpaid interest of
the joint consolidation loan (as of the date that is the day
before separation of the joint consolidation loan) and any
outstanding charges and fees with respect to such loan; and
``(i) the percentage of the joint consolidation loan
attributable to the loans of the individual borrower for whom
such separate consolidation loan is being separated, as
determined--

``(I) on the basis of the loan obligations of such borrower
with respect to such joint consolidation loan (as of the date
such joint consolidation loan was made); or
``(II) in the case in which both borrowers request, on the
basis of proportions requested by the borrowers, outlined in
a divorce decree, court order, or settlement agreement;

``(B) have the same rate of interest as the joint
consolidation loan (as of the date that is the day before
separation of the joint consolidation loan); and
``(C) not be considered new loans, shall be deemed to have
been made on the date such joint consolidation loan was made,
and shall have the same terms and conditions as other
consolidation loans made under this part on such date.''.

The SPEAKER pro tempore. Pursuant to clause 2(b) of rule XIX, the
previous question is ordered on the motion to commit.
The question is on the motion to commit.
The question was taken; and the Speaker pro tempore announced that
the noes appeared to have it.
Ms. FOXX. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to section 8 of rule XX, further
proceedings on this question are postponed.

____________________