WASHINGTON – Democratic presidential hopeful Hillary Clinton on Monday lauded Minnesota’s new student loan refinancing program unveiled last week.
Under the program, administered by the state’s Office of Higher Education, a borrower who owes $40,000 at an 8 percent interest rate could lower monthly payments between $200 and $300.
Minnesota’s plan came out of the 2014 legislative session, where a law change allowed the state agency to refinance student loans through the sale of state-backed bonds.
“I applaud Minnesota for taking bold steps toward ensuring that debt won’t hold Minnesotans back,” Clinton said in a statement. “If you can refinance your mortgage or your car loan, you should be able to refinance your student loan, too.”
Clinton has launched her own version of a student loan refinance plan. Under her proposal, a student who has borrowed a total of $30,000 in loans at 6.8 percent or higher could pay up to $4,000 less in interest over the life of the loan, with the monthly payment dropping as much as $33.
The topic is a hot one on the presidential campaign trail — particularly among Democrats working to target young people. Clinton’s primary rival, Sen. Bernie Sanders of Vermont, has called for anyone to be able to attend a public college or university free, but Clinton has questioned how that would be paid for. Sanders also has said all 40 million Americans who owe money on student loans should be able to refinance.
Students and families in Minnesota borrowed $3.1 billion to pay for college debt last year, the Clinton campaign said.