EAST LANSING – A bipartisan proposal expected to be introduced in Congress Tuesday would erase private student loan defaults from credit reports after college graduates make nine consecutive payments.
U.S. Sen. Gary Peters, D-Bloomfield Township, announced the legislation Monday at the Michigan State University Union.
Peters said the bill, which he will introduce Tuesday, would help graduates stay current on private loans while starting their careers and families. He said payment plans are already in place for federal loans.
He said his bill, while not a cure-all, would allow graduates who have defaulted on private loans to work with banks to create payment plans. Banks would not be required to participate.
"One thing about a student loan is you can never discharge it. The student loan is going to be with you for your entire life," Peters said at Monday's press conference. "What my legislation does is to ensure that those students who may have defaulted get a second chance."