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federal student loans
federal student loan
student loan debt
credit card debt
obama
bragging rights
Federal Student Loan Program
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Federal Student Loan Program

On October 26, 2011, President Obama came up with a proposal for the Federal Student Loan Program, the proposal is named Pay As Your Earning plan. His proposal would lower your monthly payments on your already approved federal student loans disproportionate to your earnings.

Congresses approved this original plan by back in 2010, said that you will be able to reduce your monthly payments to 10% from 15% of your income as of 2014. Also a balance of your debt will be forgiven after 20 years of paying on it instead of 25 years. Obama said that he will be using an executive order to make those benefits available to borrowers as early as 2010.

Then on June 29, 2012 it was reported that Congress approved legislation preserving jobs on transportation projects and avoided increased interest rates on millions of college students, trying to give the bragging rights just before the November elections, as we all know it did not help them much.

Under the bill it continued the subsidized Stafford loans for graduates to stay at 3.4% for another year, stopping an increase that would have doubled new loans from a bill that was passed 5 years earlier to save money. This would have added an extra $1000 to the average cost of over 7.4 million students each which would have been increased to 6.8% interest rate.

As of now you will to get charged interest until after you graduate no matter how long it takes. But with this new bill they will start charging interest on subsidized Stafford loans no more then 6 years after the undergraduate starts there studies, to help the government to raise more revenue.

Despite legislation trying to expand student loan forgiveness, student loans currently exceeds all credit card debt in America, also in 2012 the student loan debt passed the one trillion dollar threshold. We can only hope that the President and Congress can get together on this very pressing economic problem and put together a plan for it.

Every year thousands of students depend on loans from both personal and federal level to get there degree. Almost 2/3rd of students borrow to pay for there intuition, there average debt upon graduation is $26,600.

The combination of the lukewarm job market and crushing debt effects the economic downturn for most students upon graduation. In 2012 students have defaulted on $76 billion in the United States, making Washington to go back to the drawing board and fix this economic problem that they have started.


Street Talk

Staggering numbers!

Reply
  about 9 years ago

very informative thank you

Reply
  about 9 years ago
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