New Jersey Gov. Chris Christie on Monday signed into law a bill requiring the state’s student loan agency to forgive the loans of borrowers who die or become permanently disabled.

Last July, an investigation from ProPublica and The New York Times found that New Jersey’s student loan agency aggressively sought repayment of loans with already onerous terms, even after some of the recipients had died. The efforts had traumatized grieving families, and forced some into financial ruin.

The state loan agency, known formally as the Higher Education Student Assistance Authority, is responsible for roughly $1.9 billion in outstanding loans. Christie, who appointed the agency’s top official and has the power to veto any action taken by the agency’s board, would not respond when presented with ProPublica’s findings last summer.

The investigation by ProPublica and the Times, however, did prompt a legislative hearing, and Monday’s action by Christie is the culmination of efforts by state lawmakers to reform the loan agency’s operations.

“A parent’s worst nightmare is losing a child, and if that unfortunate event should occur, the last thing a parent should have to face is someone calling to collect money for student loans,” said State Sen. James Beach in an emailed release. “This law will put an end to that practice and help establish new policies to put in place.”

The new law brings the state’s program closer in line with federal student loans, which are forgiven when students die or become permanently disabled.

A projection from New Jersey’s nonpartisan Office of Legislative Services estimated that under the new loan forgiveness law, about 70 loans a year would be discharged as a result of death or disability and would cost the state about $1.5 million annually.

“To expect a student’s family or other survivors to pay their college loan debt in the event of their death is cruel and unacceptable,” said New Jersey Assemblyman Andrew Zwicker in an emailed release following the signing of the bill.

rest at https://www.propublica.org/article/new-jersey-will-no-longer-collect-loans-from-families-of-dead-students

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