How this company helps student loan borrowers become debt free

let's get to some news that we got today on student loan debt president biden's chief of staff saying today that the president is looking into potentially canceling student loan let's listen he asked his secretary of education who's just put on the job a few weeks once he got on the job to have his department prepare a memo on the president's legal authority and hopefully we'll see that in the next few weeks and then he'll look at that legal authority he'll look at the policy issues around that and he'll make a decision we want to bring in will will seely for a little bit more on this he's co-founder and ceo of summer and it's a platform here that you help students save money when it comes to paying off their student loans well i first want to ask you what we just heard from ron clean the fact that he was saying that the president is looking into a way looking into his legal authority i should say to cancel student debt what's your reaction to that yeah we just for context represent tens of thousands of borrowers who are actively trying to navigate a complicated repayment landscape and this is folks uh of all ages uh the average age on our platform is well into folks late 30s early 40s so people are spending decades navigating this issue um and so when the president is saying that he's navigating the student loan repayment process for the whole uh cohort of 1.6 trillion dollars of debt across 45 million americans uh i think it reflects the complexities that are involved and him wanting to get it right uh you have a lot of progressive groups that are pressuring the white house to take immediate action on mass cancellation uh obviously there are a lot of folks on the other end who are saying uh i've already paid my student debt that uh how does that impact me uh at the end of the day we represent borrowers and we want what's best for them uh and so we think some form of cancellation makes sense when i was looking at your profile correct formerly at the consumer financial protection bureau correct that's correct so so you've seen how some of these loans can take advantage of people who don't quite understand what they're getting into i was most impressed with the average savings that summer has of thirty thousand dollars for people with consumer loan um i call it indentured servitude can you tell us more about how you save people money yeah so summer was created by borrowers to help student loan borrowers across the country i myself have student debt many of the folks at summer do as well uh we with we work with large organizations like the american federation of teachers representing nearly two million teachers who during the pandemic as you all know have been put into really tough positions trying to help their students get the education they deserve all while doing it during a pandemic that is putting many many people's lives at risk we just don't believe that student debt should be the thing that pushes them over the edge the thing that prevents them from being able to help the people in their communities that they seek to do and so we go in and help teachers we help doctors nurses anyone who's amassing student debt enter into affordable repayment programs these are federal state and and other programs that exist to help people navigate programs like income driven repayment unfortunately these programs are very complicated and the reality is even if the biden administration does cancel a huge portion of student debt unfortunately in this country that's debt's not going away and so we exist to to help create a system where borrowers can enroll in these programs that are complicated to do a lot of people liking it to filing your taxes only there has never been an accountant there to help in any shape or form we're trying to fill that void give them a trusted source of information and the software to navigate those tough complicated application forms rt i think you need to unmute i believe i am there you go um well um we've talked a lot about administrative burden we've talked about this issue of idr and basically the paperwork being such a challenge but i'm curious can you tell us a little bit about the partnerships you've had with the aft and other organizations um how that works and how you created them sure thing so the american federation of teachers which represents close to 2 million teachers across the country they're constantly trying to represent teachers best interests and they provide a host of membership benefits in the affiliation and so they're introducing summer to teachers we have similar partnerships with afscme an organization that represents over a million public sector employees and and we've heard from these unions that their members are struggling to enroll in programs like income driven repayment public service loan forgiveness and again not too dissimilar from your taxes they need additional support so summer is a platform it's a software-based system that these unions and our other partners we work with dozens of employers uh both for-profit and non-profit employers providing summer uh to their to their employees as a workplace benefit uh and this voluntary benefit allows people to get into these programs and save quite a large sum of money as i believe was mentioned earlier we're saving borrowers close to 30 000 on average by enrolling them in these loan assistance programs that they otherwise didn't know about or tried to enroll in but were wrongly rejected well just a follow-up question so in the cares act in the following stimulus package there was a provision to basically help employers help their employees pay down their student loan debt can you talk a little bit about have you started incorporating this into your platform it just seems like a very interesting way to help borrowers yeah great questions so just recently in december congress moved forward with a new provision that allows for employers to contribute to their student loans of their employees tax-free so there's a tax benefit involved not too dissimilar from a match on a 401k for an employee and so a lot of employers are now asking themselves how can we do our part to fix this problem clearly this is an issue we're hearing it every day it's all over the news student debt is a problem and it's not just that student debt is too much it's that it's very complicated to navigate this issue you have spouses where two folks have student debt and we work constantly where there's each spouse has student debt and they have student debt for their children and so when you think about the complexities of different loans both private and federal there's over a dozen different types of loans there's over a dozen different types of repayment plans tracking it is unbelievably complicated so i think more and more employers are realizing what is our part what is our role to play so summer is now partnering with dozens of employers and we're working with them to figure out how much money to allocate to their employees student debt as another option to be able to chip away at this debt burden that is on the backs of millions of americans well just quickly one last question so what is the worst case scenario for october what worries you so much about that deadline yeah i think that uh if folks are unaware millions of borrowers will be re-entering student loan repayment uh this october it's just a few months away and the challenge is is that borrowers are paying hundreds if not thousands of dollars a month on their student debt uh so while we've seen the economy economy and its turbulence over the the last several months and really the last year uh the the premise that borrowers are going to be magically ready to repay in october i think is a false one i i am personally worried about how many millions of borrowers will be at risk of missing loan payments and then defaulting on their student debt which can result in fees of thousands if not tens of thousands of dollars and so and wrecking their credit scores along the way so what we're doing is we're looking to partner with some very large organizations to get word out that borrowers need to start planning over the summer for this historic moment when loans come due again in october and one of the best ways they can prepare is by enrolling in an income driven repayment plan so that if they're unemployed their loans can be as low as zero dollars or if they're underemployed their loans will be significantly lower than what they would have paid in a standard repayment plan all right well silly great to see you see you co-founder and ceo of summer and then of course rt swaminathan always great to have you on this

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Id: IEao93FjOR4

Length: 9min 19sec (559 seconds)

Published: Thu Apr 01 2021