R Street Institute

R Sheets Finance and Trade

Massachusetts Suspension of Occupational Licenses for Student Loan Default

by C. Jarrett Dieterle AND Nicolas John
April 4, 2019
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Key Points

Thousands of Massachusetts residents struggle with student loan debt.
Massachusetts law permits licensing boards to strip individuals of their professional licenses for falling behind on student loan payments.
This power hinders workers’ abilities to repay debts and fails to reliably deter defaults.
License revocations are unnecessary because other, less-harmful, debt-collection tools are available.
Massachusetts should repeal this power, as other states have already done.

In recent years, student loan debt in America has ballooned. Estimates peg the total outstanding student loan debt at $1.4 trillion, an increase of over $800 billion in the last decade. If anything, the situation is even worse in the Bay State, as Massachusetts sits in the top 10 of states with the highest average debt levels for recent college graduates. At present, 60 percent of Massachusetts graduates from the Class of 2016 are burdened, with the average amount owed being $31,563.

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