Christie signs bill to forgive college loans if student dies
TRENTON -- Gov. Chris Christie on Monday signed legislation allowing certain New Jersey student loans to be forgiven if the borrower dies.
The Republican governor signed the legislation along with 14 other measures but didn't offer any comments on the student loan legislation. He did not take questions at an event in Atlantic City.
The measure forgives New Jersey College Loans to Assist State Students (NJCLASS) if the borrower dies, even if a parent or guardian co-signed the loan.
The loan program came under scrutiny after media reports focused on its stringent rules and aggressive collections process, which is much more restrictive than other states. Federal student loans are forgiven on the death of the borrower.
The program helps cover college costs not already paid for by other grants, scholarships and loans and offers low-cost rates on loans to New Jersey residents attending eligible in-state or out-of-state schools and to out-of-state students attending a New Jersey school.
Loan forgiveness also applies in cases of permanent disability under the new law. Temporary deferment in cases of temporary total disability is also now permitted.
Parents and student borrowers who testified at a hearing in August said much more needs to be done to fix how the state handles the loans.
The Office of Legislative Services estimated that the legislation could cost the state roughly $1.5 million a year over the next three years.
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