Murphy signs measures to reform NJ's student loan payback rules

Mark Abrams
April 25, 2019 - 3:52 pm
 Gov. Phil Murphy

Amy Newman/NorthJersey.com via USA Today Network

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TRENTON, N.J. (KYW Newsradio) — Gov. Phil Murphy signed legislation in Trenton Thursday giving borrowers a break on repaying state-backed college student loans if they run into financial hardships. 

Murphy said the measures, which are restructuring the student loan programs through the New Jersey Higher Education Student Assistance Authority, will provide a lifeline that many borrowers need to get themselves back in control of their loans, instead of their loans controlling them.

One of the bills "allows residents the flexibility when they are facing financial insecurity or hardship, said Murphy, "to change their repayment schedules so they can still afford to pay the rent or to put gas in the car or to provide for their families."

The second bill offers grads with student loans in default to do balanced installment plans that are within their means, plus the chance to repair their credit rating with the loan agency.

Murphy said the two reforms will reduce the financial pressure on borrowers — in the past and future — and give them a better shot at pursuing employment and affordable housing.

The governor said the last thing he wants is a system that's so rigid and insensitive that it leaves borrowers with no way out and no way forward.