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BRIn 2010, Syracuse-Native Andrew Prior Was Tragically Killed By Drunk Driver in Boston Hit-And-Run It Took Two Years Schumers Intervention Last Week to End Financial Emotional Hardship and Get Debt ForgivenBRBRSchumer Reveals Plan to Introduce Andrews Law to Require Private Student Loans to Be Discharged if Borrower Dies, Ensuring Parents Arent Held Liable for Debt New Requirement Needed to Prevent Some Private Loan Providers From Hounding Grief-Stricken ParentsBRBRSchumer: Student Loan Deb


Today, during a press conference call, U.S. Senator Charles E. Schumer revealed new legislation called 'Andrew's Law', in honor of his constituent Andrew Prior, who was tragically killed by a drunk driver shortly after graduating from college. Andrew Prior had one federal loan and three outstanding private student loans at the time of his death, which were cosigned by Andrew's parents, Mr. and Mrs. Prior. The federal loan and two of the private loans were forgiven shortly after Andrew's passing, yet it took over two years, and Schumer's aggressive intervention last week, for the loan servicer to forgive the remaining student loan debt.


While federal student loans are required by law to be discharged in the event that the borrower dies, the same requirement does not apply to private student loans. Schumer's new legislation would help ensure that the unnecessary financial and emotional strain experienced by the Prior family is not repeated. Schumer's legislation would require that private student loans be discharged if the borrower dies, ensuring that parents who had cosigned the loan are no longer held liable for the debt. Currently, all federal student loans are required to be fully discharged if a family member or other representative provides a certified copy of the death certificate to the lender or loan servicer. Schumer's legislation would apply the same treatment for all prospective private student loans.

" Andrew's Law will honor Andrew Prior's legacy and ensure that student loan debt is one burden that grieving parents like the Priors don't have to bear," said Senator Schumer. "No parent should ever be put through the ringer by callous servicers and lenders, and there is no question that we need to put this common sense and compassionate policy into law. Sadly, we can't always rely on these private companies to do the right thing for suffering parents; and we need to write the rules - which would require that private student loans are discharged if a borrower dies - in stone."


Last week, Schumer was joined by David and Rose Prior as he successfully fought to assist them in their efforts to resolve the potentially crippling financial burden of repaying their deceased son Andrew Prior's student loan. Schumer, who had been working on this case since January, highlighted that in the case of federal student loans and federal PLUS loans (loans made directly to parents on behalf of students), protections exist under current law that protect borrowers' families by requiring loans be forgiven or discharged in the event that the borrower dies.


In Andrew Prior's case, in addition to a federal loan, he had three outstanding private student loans at the time of his death, which do not carry the same legal protections. The companies that owned two of these loans, Discover Student Loans, and Education Empowerment Fund, worked expeditiously with the Prior family to discharge the loans and ensure that this family's credit was not negatively affected. However, up until midFebruary 2013, over two years after Andrew Prior's death, the third private loan had not been forgiven, and the loan servicer is reported to have hounded the Prior Family for payment, and even threatened to take away their home and car. Schumer learned of the incredible emotional and financial stress that this loan servicer was causing for Mr. and Mrs. Prior, and successfully urged the private company to forgive their debt.


Schumer highlighted that many private loan providers, such as Sallie Mae and Wells Fargo, are upstanding corporate citizens and have established programs to forgive debt in the event of the student borrower's death, just as federal loans do. This precedent allows for compassion to enter the financial marketplace. Schumer highlighted, however, that this practice must be universal, and there should be no room for bad actors to hound griefstricken parents for their lifesavings.


Schumer stated that the death of a student borrower is rare when compared to the population of American student borrowers. Forgiveness of these loans under such a unique yet tragic circumstance as death would have an insignificant impact on the larger private loan system and ratepayers, while offering incredible financial and emotional relief to these families. Private Student Loans make up less than 15% of total student debt outstanding as of January 1, 2012 and contributed less than 7% to the estimated $112 billion in total student loans originated in 20102011. Most private loans require at least one borrower to be "creditworthy": currently employed, having a minimum credit score and, in more recent years, meeting other criteria such as a debt to income ratio. Many undergraduates would not meet these requirements, and today, most private loans for undergraduates (and a large number of loans to graduate students) must be cosigned by a creditworthy person.


Andrew Prior was a graduate of Northeastern University in Boston, who majored in American Sign Language and English Interpretation. In November of 2010, just months after his graduation in May, Andrew was riding on his Vespa scooter and was tragically killed by a hitandrun drunk driver in an SUV. Andrew is survived by his parents and his two brothers John and Mark.


A copy of Senator Schumer's one page summary for his new legislation, "Andrew's Law" appears below:


Andrew's Law

Sen. Charles E. Schumer

113 th Congress




ØNo pain is worse for a parent to endure than the death of a son or daughter. When tragedy strikes, fairness and decency requires that families do not have their emotional burdens compounded with crippling financial obligations.

ØWith a secondary education becoming evermore important to succeed in the modern economy, and at the same becoming evermore expensive, students are relying increasingly on borrowing to finance their educations. Student loans have now surpassed credit cards as the largest source of consumer debt in the United States, according to the Consumer Financial Protection Bureau (CFPB), with outstanding student loans passing the $1 trillion mark last year.

ØMoreover, many private student loans require a parent to cosign the loan, because students often cannot meet standards of creditworthiness required for borrowers. As a result, most private student loans for undergraduates (and a large number of loans to graduate students) must be cosigned by a creditworthy person, usually a parent.

ØParents and their children make this investment in the hope that it will pay off in the form of a brighter future for the children. But when those bright futures are snuffed out tragically and prematurely, it is only right that the parents not be buried under the weight of those obligations.

ØFederal law recognizes the hardship imposed on grieving parents, requiring that the Secretary of Education forgive student loans, including federal PLUS loans made to parents on behalf of their children, when the student dies.


ØHowever, there is no such requirement for private student loans. While some private student loan companies have adopted policies that provide for discharging student loans if the borrower dies, the practice is far from universal.

ØAndrew's Law, named after a Syracuse resident tragically killed in a hit and run car accident in 2010, would extend the protections available for federal student loans to private student loans, relieving grieving families of the burden to repay the remaining balance of the loans taken out by or on behalf of their child. Families would be required to provide a death certificate to the loan servicer, as is currently the case with federal loans.