Oldsmar man leads student loan fight
By ERNEST HOOPER
Published June 7, 2006
The huge flashing matrix sign in front of the University of South Florida's Sun Dome delivers a message to students more important than any concert or basketball game.
CONSOLIDATE YOUR LOANS
The words are more that just good financial advice. For millions of students and parents repaying federal education loans, the message is an ominous warning that could cost students thousands of dollars if it goes unheeded.
The interest rate on existing student loans will rise nearly 2 percentage points on July 1, one of the largest single-year increases in the 40-year history of the program.
The impact of the decision and other changes in the loan program has hit home, and not only on local campuses. Paul Simino, president of OneSimpleLoan in Oldsmar, said he is concerned about the impact on student borrowers as well as his business.
Simino and other advocates firmly believe students should have the same opportunity to refinance loans as homeowners and auto owners.
And he's not standing by idly.
Simino has filed a lawsuit in the U.S. District Court for the Southern District of New York against the Department of Education and Secretary Margaret Spellings. The lawsuit requests a temporary injunction against a ruling that eliminated some consolidation options on March 31, three months before the July 1 deadline.
The suit also challenges the constitutionally of the Higher Education Act, the congressional bill that brought about these changes, because the House and the Senate did not pass identical forms of the bill.
"It's a David vs. Goliath battle," Simino said. "We definitely look at ourselves as advocates of student loan borrowers. From all the borrower inquiries we've received, we know a lot of people out there are concerned."
So who is this guy who is willing to take on the federal government?
Simino is a 1992 Jesuit High graduate who says he turned to this line of work in 2003 to transition out of the vacation travel business after the terrorist attacks of Sept. 11, 2001. He was considering becoming a financial planner when he met some folks in the student loan business.
He asked a doctor friend if medical school and law school graduates would find useful a company that consolidates loans. The friend confirmed as much, and OneSimpleLoan was off and running. It now works with all students, and the company has more than 50 employees. OneSimpleLoan is a member of the National Council of Higher Education Loan Programs, which is holding its spring convention at the Don CeSar Beach Resort and Spa in St. Pete Beach this week.
Simino says many of his colleagues are keenly interested in the outcome of his suit, and with good reason. The change is going to be bad for his business and even worse for students.
"Lost business opportunities are obviously a factor," Simino said. "I would say more of a factor is that we really, honestly, truly believe it's in the best interest of the borrower, and the majority of the community, from what I understand, agrees with that philosophy."
What I don't understand is why the challenges continue to grow for college students.
News about the interest increase in student loans comes just months after funding for Pell Grants for undergraduates was slashed by nearly $13-billion.
I don't know if it's short-term memory, but many of our elected officials and policymakers seem to have forgotten the challenges of college. Or perhaps they believe that since they walked to campus uphill both ways in 6 feet of snow, today's students should have to do the same.
Of course, students have to share in the blame. Although organizations are trying to create a more politically powerful coalition among students, they won't gain the ear of government until they can marshal enough votes to knock someone out of office.
Still, as a community we should be making it easier to finance the cost of higher education, and I'm not just saying that because my older son is five years away from walking on a college campus. With this country continually losing ground to international powers such as China and India, we need to recognize the global playing field is level and equip young people with the tools to succeed.
Instead, we seem to be tilting the field to their disadvantage.
That's all I'm saying.
- Ernest Hooper can be reached at 813 226-3406 or hooper@sptimes.com