Murphy Rejects Student Loan Giveaways, Cosponsors Simplified Joint Consolidation Separation Act

Washington, D.C. – Today, Rep. Greg Murphy, M.D. (NC-03) spoke on the House floor in support of the Simplified Joint Consolidation Separation Act, a Republican alternative to S. 1090. While Rep. Murphy supports the original intent of S. 1090, which permits married borrowers to urgently separate their loans, he has major concerns about this legislation becoming yet another tool for the Biden Administration to forgive mass loans in the wake of the President's unconstitutional student loan giveaway.

"It is essential that we ensure victims of spousal abuse are able to sever joint consolidation loans without penalty or delay," said Rep. Murphy. "While I support the intention of S. 1090 to separate these loans, President Biden's unconstitutional student loan giveaway scam has drastically changed the context in which we consider this bill. S. 1090 gives the Administration authority and creates a pathway which could be used to grant additional loan forgiveness. Once these loans are separated into the Direct Loan program, these loans will be eligible for Biden's near trillion-dollar student loan scheme. 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 the Administration's authority to directly aid those in need. This targeted, commonsense legislation should garner immediate support from both sides of the aisle."

Background: Under the now-defunct Federal Family Education Loan (FFEL) program, married borrowers were permitted to consolidate their loans together into one joint consolidation loan (JCL). The practice was stopped in 2006. There is clear bipartisan agreement that married borrowers who need to separate their loans urgently – whether it be because of divorce or abuse – should be provided immediate assistance to do so.

Republicans support the underlying principle of permitting married borrowers to separate their loans, however, Republicans do not want this legislation to be used as another process through which the Biden administration brings more loans onto their books only to forgive them. S.1098 broadens the Secretary's authority which could be used to grant additional loan forgiveness. Once the loans are separated and moved into the Direct Loan program, they will be eligible for the Biden Administration's student loan giveaway.

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