WASHINGTON — The Consumer Financial Protection Bureau said Thursday it was requesting public comment on the best ways for Congress to help struggling student loan borrowers.
The agency and others have been increasingly concerned in recent years that the $1 trillion in outstanding student loan debt is setting up the next potential financial crisis, noting similarities between student loans and mortgages. Private student loans make up about 15% of the overall debt outstanding.
The CFPB said many borrowers face high payments but lack chances to modify or refinance those loans.
"Too many private student loan borrowers are struggling with unwieldy debt that prevents them from climbing the economic ladder," said CFPB Director Richard Cordray, in the release. "We will be analyzing plans for policymakers to consider that might help avoid a repeat of the mortgage meltdown for today's student loan borrowers."
The CFPB released a formal request for information asking for comments on several issues, including: the impact of student debt on the economy and how it hinders access to mortgages and car loans; how distressed borrowers manage their debt obligations; lower monthly payment options that exist for student loan borrowers; and other alternative payment options that could be applied to the student loan market.
The CFPB will be taking comments through its website until April 8.