The Montana senate is considering a bill, which passed the state's house in March, that would repeal a statute that made it possible for student debtors to lose their occupational and driver’s licenses if they defaulted on their student loans—meaning they had not made payments in at least 270 days. Iowa legislators introduced a similar bill in February, but it stalled in the state senate this month because of a procedural obstacle.
The little-known laws exist in at least 22 states and have been on the books in some states since as far back as 1990. Advocates for repealing them say they have real consequences for people who cannot make a dent in their student debt.
“It’s the most inappropriate consequence, because you are taking away their ability to eventually pay [their loans] back,” says Moffie Funk, the Montana state representative who sponsored the bill. In Montana, where there is little public transportation to speak of, driving is the only way most people can get to the jobs they need to repay their debt, Funk says.
