Posted on 04/03/2010 8:45:29 AM PDT by Libloather
How Does Obama's Health Care Bill Affect Your Student Aid?
Federal loans and grants for college change when the bill becomes a law on Tuesday.
By Alexandria Bradshaw
Mar 30 2010 2:16 PM EDT
President Obama signed the Health Care and Education Reconciliation Act on Tuesday morning (March 30), after the bill passed in the House last Thursday. Setting aside the complicated health care reform the law tackles, the Student Aid and Fiscal Responsibility Act (SAFRA) included within it is intended to make paying for and completing college more feasible. According to the White House, SAFRA is expected to save taxpayers $68 billion over the next decade while nearing the Obama administration's goal of having the highest percentage of citizens who are college graduates in the world by 2020.
So how, exactly, will the new legislation affect you?
Eliminating Subsidies for Lenders:
SAFRA will eliminate grants given to private banks and other financial institutions who distribute federal student loans. These loans, formally known as the Family Federal Education Loan program, are most commonly referred to as Stafford Loans. The new bill will replace Stafford Loans with lower-interest loans provided directly by the government to students.
Increasing Pell Grants:
A Pell Grant is money given to you by the government that you do not have to pay back. Under the new act, $36 billion will go toward increasing maximum annual Pell Grant scholarships. Students who qualify for financial aid will now be eligible for up to $5,500 (up from $5,350) in grants for the 2010-2011 school year. This figure will increase to $5,975 in 2017.
Strengthening the Income-Based Repayment Program:
The current Income-Based Repayment Program allows borrowers to cap their monthly loan payments at 15 percent of their income. SAFRA will invest $1.5 billion in the existing program to lower this number to 10 percent for new borrowers (recent college grads) after 2014.
Increasing Funding for HBCUs, MSIs and Community Colleges:
Historically black colleges and universities (HBCUs) and other minority-serving institutions (MSIs) will share $2.55 billion to provide their students with the resources and support they need to graduate. Additionally, $2 billion in competitive grants will be offered to strengthen programs at community colleges.
You can access information and resources related to college completion at GetSchooled.com, where you can also watch the "Get Schooled: You Have a Right" special featuring President Barack Obama, LeBron James and Kelly Clarkson.
“Historically black colleges and universities (HBCUs) and other minority-serving institutions (MSIs) will share $2.55 billion to provide their students with the resources and support they need to graduate.”
To paraphrase, “from each white voter stupid enough to vote Democrat to anyone who isn’t white, according to their need.”
Is this racisss?
Isn't that, um, racist?
Ya beat me to it. *\;-)
It certainly sounds racist. “... to provide their students with the resources and support they need to graduate” implies remedial education. In other words, they’re too dumb to graduate on their own.
Great minds, though...when are we gonna start challenging the constitutionality of THIS kind of sh*t? What are we afraid of, losing the black vote?
“In other words, they’re too dumb to graduate on their own.”
Which also implies a GREAT chance it will be repaid somehow...good place to invest my money for me.
so the payback (pie) to the black caucaus for voting “yes” on “health reform” was almost $5 Billion for “HBCU’s” and “MSI”s
And I read somewhere that govt takeover of Stafford will cost 35,000 jobs in the banking sector
“And I read somewhere that govt takeover of Stafford will cost 35,000 jobs in the banking sector...”
The reasoning for the takeover is to “eliminate the middle man.”
So, can the baking industry as a whole be far behind? FDIC guaranteed loans are government loans, by their reckoning...the coup continues unabated.
Unless I missed it article does not mention kickback to healthcare when getting a loan.
Students who qualify for financial aid will now be eligible for up to $5,500 (up from $5,350) in grants for the 2010-2011 school year. This figure will increase to $5,975 in 2017.
Do you suppose there’s going to be a lot of “upper” middle class students who no longer will be eligible for loans because of their parent’s income? Quite a bit more “redistribution” going on here?
A much better question would be: WHY Does Obama's Health Care Bill Affect Your Student Aid?
ML/NJ
Like the 10% tax on tanning beds?????????
Nail salons would have produced more revenue, women of all colors want nice nails and don’t think twice of plunking down $30 bucks or more to get them, they have to be filled at least once a month, and replaced about every 3 months. Neat racket.
Me I use a nail file, bottle of nail polish, and nail polish remover and do my own. Saves a bundle of money per year.
Kids and parents, don’t fall for this!
Government insured student loans are causing you to GROSSLY OVERPAY for your college education.
Get your education, but get it as cheap as you can and avoid student loans as much as possible.
Watch this Peter Schiff video. He explains why this is such a bad idea:
http://www.youtube.com/watch?v=AIcfMMVcYZg
Americans need to wake up and stop the financial enslavement of ourselves and our children to the Federal government.
The government is causing the price of college to be artificially high, just like they did for houses. Instead of a college degree costing $15,000, because the gov’t is giving out money right and left, the schools can raise their tuition every year, which causes the degree to cost $60,000. A lot like too much mortgage lending turned $250K houses into $500K houses!
That causes everyone to overpay for their education, whether they take out loans or not... and it’s a very bad thing. By flooding the education market with an unlimited amount of easy-to-get funds, the GOVERNMENT has caused the cost of college to skyrocket, while the quality and value of a college degree has gone down.
Millions of students are taking out billions of dollars in student loans in order to overpay for an inferior product. Student loans can be just as toxic as any other type of debt that we are constantly vilifying these days.
The student loan tab is over $730 billion and growing! These loans are basically no down payment, bad credit no credit ok, no income documentation-required loans with an unlimited credit limit. Isn’t that the definition of predatory lending?!?
Except in this case, YOUR LIFE is the collateral for student loans. If people had to save up their hard-earned money in order to pay for college (even if they only paid for a quarter of it upfront), they would be much more careful about the price.
Like any other product, if people saw a value in it, they would be willing to pay for it. And if they demanded higher quality education for their money, the schools would have to improve their product in order to earn their business. Universities would have to raise the quality of the education in order to compete for those hard-earned dollars. The cost of education would plummet and the quality would skyrocket!
The gov’t is loaning kids and their families tens of thousands of dollars (sometimes hundreds of thousands of dollars) in federally guaranteed student loans without any regard for their ability or inability to pay them back.
This easy-to-get money is driving the cost of education through the roof, while driving the quality of education into the ground (Dr. Thomas Sowell’s book, Economic Facts and Fallacies, is worth the price of the book just for the chapter on the damage that student loans are causing to our higher educational system). And university presidents and college professors are laughing all the way to the bank.
Unlike an underwater mortgage though, you don’t get to “walk away” from student loan debt. More than any other debt, it is next to impossible to get out of re-paying federally guaranteed student loans.
They practically cannot be discharged in bankruptcy and you have to be almost completely disabled to have them forgiven. (I believe that people have a responsibility to re-pay loans, by the way. I am NOT for walking away from any kind of debt.)
Defaulted student loans can stay on your credit report INDEFINITELY and destroy your credit scores for many years. You cannot get an FHA or VA home loan if you have defaulted gov’t student loans. Most states and gov’t agencies will not allow you to get certain types of licenses if you have defaulted student loan debt. The gov’t will garnish your wages and confiscate your tax refund in order to get its money back for student loans.
The most evil part of all is the government’s offer to “forgive” the debt in exchange for years of “public service”.
Imagine how hard it will be for a kid who is tens of thousands of dollars in debt, who holds a worthless college degree in his hands and has very few prospects for employment to turn down a job with the Federal government, who is willing to pay him twice the private wage rate and give him unbelievably generous benefits and allow him to retire at an early age with a pension. There is no way he will be able to turn that offer down... like an offer from the mob, it will be an offer from the gov’t that he simply can’t refuse.
There is also no way the private sector will be able to compete for the best workers against a gov’t who pays double the average wage and forgives all of that debt. Private companies will go overseas to find workers, which will make finding a job even harder for non-government workers... what a vicious cycle!
Student loans are creating a generation of indentured servants and they are a back door entrance for a gov’t takeover of our private economy.
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