By: Erica Romero, VP, Education Policy and Advocacy

Like millions of other Latino students, attending and graduating from college has been one of my greatest accomplishments. One that would not have been possible without financial aid – and yes – student loans. I grew up in an immigrant and low-income community, which meant that the idea of pursuing a college education also came with a hefty price tag, a sacrifice I was willing to make in order to improve my future. 

Since graduating from Harvard in 2005, I have spent two decades working to ensure that more Latino students have access to higher education regardless of their background. The issue of college costs has also been personal for me – at the same time that I was advocating for others, I was also writing a check each month to pay back my own student loans.

Luckily, in the beginning of 2022, I was able to apply for a student debt relief program – the Temporary Extended Public Service Loan Forgiveness program (TEPSLF)  – and $40,000 of my student loans were forgiven. This not only allowed me to continue working in the capacity I desired, but also helped me improve my credit score that had taken a severe hit because of my debt to income ratio. Because I received such a hefty forgiveness amount, my FICO score jumped fifty points and I was able to make a down payment on a new condo. 

This is not the case for the majority of students, especially Latino students. Latino students historically take out more loans than their peers, take longer to repay those loans, and are hindered by debt for longer periods of time. The consequences of attaining a higher education degree have affected millions of Latino college graduates for too long, and continue to do so. For too many others, they get the burden of debt without the benefit of a degree. This is not what the American Dream is all about. 

Tackling the issue of student debt will require both investments on the front end and the back end. We need to first address the strategies that make college more affordable, such as doubling the Pell grant, which would increase the number of low-income students who could attend college without financial strain, or even increasing emergency funding for struggling students. 

Depending on current loan repayment programs to ease the financial burden, however, is not enough. Repayment programs are riddled with regulations that make it difficult for many people to make meaningful headway when it comes to lowering their debt. While the Department has recently made improvements to the student loan debt relief programs, including PSLF, more needs to be done. 

For example, under certain loan repayment programs, like Income-Driven Repayment programs which allow students to set their loan repayment amounts based on a percentage of their income, interest continues to accrue, even if their loan repayment amount is lower than the amount of interest due.This often results in low-income borrowers being unable to outrun interest accrual. Interest rates are so high that even when low-income borrowers make payments on their loans, their balances still increase.

This is an overtly exploitative tactic that capitalizes on communities of color. In fact, twelve years after starting college, the median Latinx borrower still owes 83 percent of their initial student loan balance while the median white borrower owes only 65 percent of their original balance. 

To implement substantial changes that make higher education more affordable, it is crucial to acknowledge the toxicity of not only repayment programs, but also the entire system in itself. Current systems uphold wealth inequality and force low-income students and borrowers to financially suffer more than their white counterparts. Debt can force borrowers to settle for a job they do not want, impact their credit score, hinder their ability to buy a house, and affect their overall quality of life.

That is why it was critical for Latinos for Education to comment on proposed changes to the current student loan repayment rules and support the Department of Education’s efforts to create a process that is simpler and fairer to borrowers. We support the proposed regulations that aim to reduce the cost of federal student loan payments for low and middle-income borrowers, beginning with elimination of accrual of interest on Income-Driven Repayment plans, among other changes. 

Additionally, we support the Department’s efforts to create a process that is simpler and fairer to borrowers and the proposed regulations to reduce the cost of federal student loan payments for low and middle-income borrowers

The total cost of education should not be detrimental to a student’s quality of life before, during, or after college. Latino students have far too much to offer to be held back by the financial consequences of seeking out a college degree and we cannot keep denying them the access to affordable, quality education that they deserve.

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Erica Romero serves as Vice President of Education Policy and Advocacy at Latinos for Education in Washington, DC.  She is responsible for providing thought leadership, policy analysis, policy development, and cultivating key partner relations with decision makers and influencers in the federal education space. 

She previously served as Assistant Vice President of State Advocacy at the Hispanic Association of Colleges and Universities, as well as Vice President of External Relations at the Association of Independent California Colleges and Universities. She is a graduate of both UC Berkeley and the Harvard Kennedy School of Government.