Posted on 01/10/2023 6:39:48 AM PST by Oldeconomybuyer
WASHINGTON (AP) — The White House is moving forward with a proposal that would lower student debt payments for millions of Americans now and in the future, offering a new route to repay federal loans under far more generous terms.
If it’s finalized, the proposal would give a major overhaul to income-driven repayment plans — one of several payment options offered by the federal government. The resulting plan would have lower monthly payments, an easier path to forgiveness and a promise that unpaid interest will not be added to a borrower’s loan balance.
Under existing plans, monthly payments are capped at 10% of a borrower’s discretionary income, and those earning less than $20,400 a year aren’t required to make payments. The new proposal would cap payments for undergraduate loans at 5% of borrowers’ pay, cutting their bills in half, and require payments only for those who earn more than about $30,000 a year.
As long as borrowers make their monthly payments, any unpaid interest would not be charged. The change is meant to prevent borrowers from having unpaid interest added to their loan balance, a practice that can cause debt to snowball.
Significantly, the proposal would also make it easier to get debt erased after making several years of payments. Existing plans promise to cancel any remaining debt after 20 or 25 years of payments. The new plan would erase all remaining debt after 10 years for those who took out $12,000 or less in loans. For every $1,000 borrowed beyond that, a year would be added.
Opponents on the right blast the revamped plan as an unfair handout with a steep price tag. The Biden administration estimates the repayment plan would cost nearly $138 billion over the decade, and some critics have put it closer to $200 billion.
(Excerpt) Read more at apnews.com ...
Loan forgiveness was a winner for the 2022 election and will be in 2024 also.
The plans were poll-tested by Democrat consultants.
Kool! Now you can get a PhD in Queer Studies at Columbia/Harvard/Stanford and never owe any more then $5,000.
The first step : get the Fed out of the student loan business. Schools can handle the loans so then they’d be on the hook for giving out dummy diplomas
‘Rats buying votes with YOUR money.
It almost seems like you can be given a free college degree IF your college degree is worthless and you will never have much income.
People who study real stuff and get real jobs and have real incomes? Oh, those people still have to pay through the nose. Suckers.
The student loan program is an integral part of the BIG EDUCATION cycle:
make huge amounts of loans available to students
raise tuition and fees to vacuum up available money
hire more highly paid profs and admins
profs and admins donate to Democrats
and repeat
Here’s a novel idea of how to lower student debt: pay back your frickin’ loans. I’m completely understanding about this and I get these poor little snowflakes problem. They have these diversity, inclusion and equity (DIE) degrees and can’t get good jobs. Tough shite. There’s a valuable lesson in life to be gained. So get off your lazy asses and work three jobs so you can pay what you owe. Maybe you’ll learn not to do glactically stupid things in the future.
Biden is turning student loan funding into a junk mortgage repeat. Pretty soon he's going to regulate Wallstreet funds and investment banks be required to fund these bad loans.
I wouldn't put one penny into student loan investments now even with a gun to my head.
My grandmother funded her very modest golden years with largely Sallie Mae investments back in the 70's and 80's. My dad thought she was nuts, earning passbook interest rates on her means of income, but she felt like she was being a good public steward.
I think the only reason for this kinda stupidity is that the USSC has leaked its position on Executive branch sponsored student loan defaults and it isn’t good for Biden. So this is plan B to save face.
Isn’t the a problem for Congress to deal with?
L
“The first step : get the Fed out of the student loan business. “
Spot on!
An important initial action would be to classify student loans in the same category as other consumer debts, reducing the risk of loans taken out for less practical fields of study, such as basket weaving.
I shudder to think what's going to happen if Biden regulates charges. Congress had better step in.
Here’s the “safety net” - you don’t take loans out you won’t pay back. Simple, huh?
Here’s another safeguard - No loans for worthless degree programs or for those without a declared major. Period.
Why should the government guarantee $100k+ in loans for someone to major in “gender studies”? Or how about a generic “Liberal Arts” degree? Or the classic “Philosophy”? Zero market for those with these degrees - and the scarce few work opportunities with such degrees - don’t pay enough to make a big student loan payment.
Way to go - encourage even more irresponsible borrowing.
If the best you can do is $30k/year with a college education - you definitely chose the wrong program of study, since one can make what is minimum wage, no degree (or even HS diploma) job at a fast food restaurant and make that amount/year.
ANd the easy money drives the tuition/fees higher, making the loans even more “necessary” - so its a snowball of power and financial manipulation.
Of course it was - a large voting block have self-inflicted debt hanging on their shoulders -and Biden offers them a free handout to remove at least a chunk of that self-inflicted stupidity (aka - delete personal responsibility)...
This will also cover the 50 million freeloading, illegal alien maggots who will go to college on the U.S. taxpayers’ dime so they can be “immigration lawyers” who will give the immigration “judges” woodies each time they allow more freeloaders from south of the border into this country. Free college and then you expect the bass turds to work for a living? The White House is doing way too many drugs.
It’s good to be king. It used to be spending proposals emanated from the House of Representatives.
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