Fall behind on student loans in Virginia and you could lose your job

RICHMOND, Va. (WRIC) — Shannon Otto graduated nursing school when she was just 18 years old. It was the Tennessee woman’s dream job.

Then, suddenly at age 32, she started having seizures and was diagnosed with epilepsy. Unable to work, she stopped making payments on her student loans.

“I got a really scary court-certified letter,” Otto said.

The letter from the State of Tennessee said her nursing license had been suspended, and she had to start paying her loans in full or she wouldn’t get it back.

“It doesn’t matter if you dedicated weeks and hours and years of your life to helping the people of your community get better because if you mess up and you can’t pay us back we are going to strip you of your work,” says Otto.

What happened to Otto could happen to hundreds of health professionals and teachers here in Virginia. A little-known law on the books allows the Commonwealth to order the suspension of a license if a person is delinquent in the payment of their “federal or state educational loans.” The law can impact teachers or health professionals like nurses, psychologists, massage therapists and more.

Virginia is one of 19 states where your professional license can be revoked if you fall behind on your student loans. 8News also found in South Dakota and Iowa, you could lose your driver’s license if you default on your student debt.

“We’ve heard stories about teachers, nurses, about barbers,” says Randi Weingarten, President of the American Federation of Teachers. “This is tantamount to the modern day debtors prison.”

She is pressing lawmakers to overturn these laws.

“If you have a job and you can’t pay your student loan, how you going to pay it when you don’t have a job, ” she asks.

Americans now owe over $1.5 trillion in student loan debt. In Virginia, according to data collected by lendedu.com, the average debt per borrower is $28,751.

With student debt levels soaring, so are defaults. Proponents argue these little known licensing laws are in the taxpayer’s best interest. Many college loans are backed by the state or federal government which ends up footing the bill if borrowers default.

“I was shocked to find out this is going on in many states,” says Virginia Delegate Eileen Filler-Corn, who argues the laws don’t make sense. “To me, it just seems counter-intuitive.”

She and Delegate Schuyler VanValkenburg have sponsored legislation that would repeal the State’s ability to yank your license if miss a student loan payment.

“It is a non-partisan issue we have Democrats and Republicans in support of this issue,” Filler-Corn said.

As for Otto, her seizures are now under control but she doesn’t have the money to get her license back.

Critics of these laws say this is not about amnesty or giving folks a free pass. They’re other ways to collect like garnishing wages, liens on property or seizing tax refunds. They believe taking away one’s ability to work is counter-productive.

The Virginia bill passed through the House with zero opposition and is now in the Senate.

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