Huckabee, Graham embrace student loan refinancing

Best Ways to Save On Your Student Loan Payments This Year

It may not be on voting rights or foreign policy, but some GOP presidential candidates appear to agree with their Democratic counterparts on at least one issue: student loan refinancing.

Although Republican front-runners such as Wisconsin Gov. Scott Walker and former Florida Gov. Jeb Bush appear not to have chimed in on the issue yet, Sen. Lindsey Graham of South Carolina and former Arkansas Gov. Mike Huckabee said during campaign events in Iowa last weekend that they would support allowing borrowers to refinance their student loans at lower interest rates.

It's an idea that's drawn support from Democratic front-runner Hillary Clinton and fellow contender Martin O'Malley, as well as progressive hero Sen. Elizabeth Warren of Massachusetts. Sen. Bernie Sanders, the Vermont independent also running for the Democratic nomination, has included in his higher education platform a pillar for student loan refinancing, as well as a plan to make four-year public colleges tuition-free.

The youth advocacy group Young Invincibles has been attending campaign events across the country and asking candidates on both sides of the aisle questions related to college affordability, student loan debt and other issues important to millennial voters.

"With student debt roughly doubling since 2008, millennial voters' path to the middle class has grown especially difficult in recent years. It's no surprise that easing this burden and college affordability are core issues for our generation," Jen Mishory, executive director of Young Invincibles, tells U.S. News in a statement. "It's good to see candidates across the political spectrum acknowledge that this is an issue that needs to be addressed, and we look forward to reviewing their detailed plans in the weeks ahead."

When asked whether he would support student loan financing at an event in West Des Moines, Graham said "absolutely," and that he would open up it up to competition, according to audio provided by Young Invincibles.

"Rather than having the Department of Education being the only bank, I would allow more people to compete for student loan business, because the more competition for your business, the better off you are," Graham said.

Likewise, Huckabee said in Indianola that students should take advantage of low interest rates "because they're never going to be lower." When Young Invincibles told Huckabee federal student loans can't be refinanced in the same way auto or home loans can, he said there "should be a way that you could."

Unlike other types of loans, it's more difficult to refinance student loans, as there is no option to do so through the government. Outside lenders and banks – such as Credible, SoFi and Discover Financial Services – have expanded options for students to refinance private and federal loans, and a bill Warren has proposed would allow borrowers to refinance their debt at lower interest rates. Republicans shot down the proposal, calling it a political stunt that would raise taxes.

"College graduates don't need a $1-a-day taxpayer subsidy to help pay off a $27,000 loan. They need a good job," Sen. Lamar Alexander, R-Tenn., said of Warren's bill last year. "And Republicans are ready to offer and debate our proposals for more good jobs and better schools, which mean better jobs.

Democrats have argued, though, that steps Congress has taken to alleviate the burden of student loan debt – such as a 2013 agreement lowering interest rates for new loans – apply only to some borrowers. And Clinton in the past has advocated for creating a path for student loan refinancing, although she has not offered a detailed plan.

"I think the interest rates are still so low for most other debt, and they're still fixed at too high a rate for student loans," she said in a 2014 interview.

"This is outrageous," O'Malley wrote in an April op-ed for The Washington Post. "If we were able to bail out big banks, we can figure out a way to refinance college loans."

Copyright 2015 U.S. News & World Report

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