Madison, WI — Representative Alex Joers (D-Waunakee) introduced legislation this week that would create an Office of the Student Loan Ombudsman within the Department of Financial Institutions and establish licensing and oversight requirements for student loan servicers operating in Wisconsin.
The bill would require student loan servicers to be licensed by the state, establish clear servicing standards, prohibit unfair and deceptive practices, and provide borrowers with a private right of action when those standards are violated. The Office of the Student Loan Ombudsman would assist borrowers, resolve complaints, analyze trends, and serve as an independent advocate for Wisconsinites navigating student loan repayment.
The proposal is rooted in recommendations from Governor Tony Evers’ 2020 Task Force on Student Loan Debt, which called for the creation of a Borrower Bill of Rights and a dedicated Student Loan Ombudsman to provide relief, education, and protection for borrowers.
“Creating a Borrower Bill of Rights and an Office of the Student Loan Ombudsman is a critical step toward holding loan servicers accountable and ensuring borrowers are treated fairly,” said Rep. Joers, the lead author of the proposal.
“As originally recommended by the task force, this legislation creates a legal mechanism to enforce servicing standards when they are not followed,” Rep. Joers added. “The Student Loan Ombudsman will serve as an independent advocate for borrowers, helping them navigate repayment and ensuring their rights are protected.”
This legislation is a common-sense response to the growing student debt burden facing the state. It will also provide a crucial layer of protection as the Trump-Vance administration attempts to haphazardly dismantle the Department of Education.
“With Wisconsin borrowers carrying more than $23 billion in student loan debt, it’s clear that students and families need access to accurate information and meaningful guidance now more than ever,” said Rep. Joers. “This bill provides a trusted resource to help borrowers make informed decisions and avoid unnecessary financial harm.”
“Addressing student loan debt is essential to promoting financial stability, economic opportunity, and long-term prosperity for Wisconsin’s students, families, and communities.”
