Amid great fanfare, President Obama on Monday announced plans to help more graduates tackle student loan debt.
However, the number of students that will benefit is like a drop in the bucket.
“We’re probably not going to have many new borrowers saying: I’m going to qualify for this,” said Mark Kantrowitz, publisher of Edvisors Network, an educational resource for students.
What the President announced wasn’t a new program; it’s an expansion of cheaper terms of an existing loan repayment program. And it won’t become available until December 2015.
People who took out loans before Oct. 2007 will qualify for the program. It lowers the amount that graduates pay, capping repayments at 10% of income. Currently, their payments are capped at 15% of income.
Nearly 5 million borrowers would qualify under this expansion.
Many graduates who took out loans after Oct. 2007 already qualify for the 10% cap.
Categories: Americas, Education, Educational Resources
Steve Forbes’ solution for student loan debt
It’s not often that Democrats like President Barack Obama and conservatives like Steve Forbes agree on the key issues of the day but that’s exactly what’s happening with the high cost of college and explosion of student debt. They both agree that rising college costs — now averaging almost $31,100 a year at private colleges and $9,000 for state residents at public colleges — and the $1.2 trillion in student loan debt have become big burdens for students, their families and the economy overall.
Where they disagree is on the solution to the rising cost of college and the associated rise in debt.
This week, recalling his own history of student loans, President Obama issued an executive order that expands the availability of lower monthly debt repayments. He also challenged Congress to pass legislation that would allow graduates to refinance old college debt at lower rates.
Forbes, who ran twice for the Republican nomination for president, is not a fan of more government intervention. He even blames government financial aid in part for rising college costs, but he laments the plight of graduates deep in debt.
http://finance.yahoo.com/blogs/daily-ticker/even-steve-forbes-is-upset-with-the-high-cost-of-college-and-he-has-suggestions-on-how-to-reduce-them-210548322.html