The bus tour comes on the heels of recent news regarding student debt, an epidemic that is cutting across all age brackets and affecting more than 38 million Americans. On August 9, the president signed the Bipartisan Student Loan Certainty Act, which ties interest rates on Stafford and PLUS loans to the fluctuations of the 10-year Treasury bond. Its being touted as a better alternative to the fixed 6.8% interest rate that doubled in July from 3.4%. But while the passage of this new law, which Republicans and Democrats claim will help students, is temporarily lowering interest rates, in five years, its estimated that interest rates will actually end up being higher than before the bill was signed — and according to the Congressional Budget Office, will make the government an extra $715 million. The CBO reports that the government is already making an estimated $184 billion from student loans — and this bill jacks up the number to a staggering $184,715,000,000. Matthew Holmes, a 24-year-old graduate of Johnson and Wales University, whose student debt is almost $20,000 in principal, says adding in the estimated accrued interest over a 10-year-period hikes his debt to almost $35,000 — $15,000 more than his current balance.
Under the ICR plan you will pay each month the lesser of: the amount you would pay if you repaid your loan in 12 years multiplied by an income percentage factor that varies with your annual income, or 20% of your monthly discretionary income…. The maximum repayment period is 25 years. If you haven’t fully repaid your loans after 25 years (time spent in deferment or forbearance does not count) under this plan, the unpaid portion will be discharged. You may, however, have to pay taxes on the amount that is discharged. The ICR program launched in 1994. Update: This isn’t the president’s first push to enroll more people in IBR; he started urging the Department of Education to do so in summer 2012 .
Student loan deal passes Senate
It means that students who borrow this fall will pay 3.8 percent on are student loans forgiven subsidized loans, 5.4 percent on unsubsidized Stafford loans, and 6.4 percent on PLUS loans. The new law reverses the interest rate jump on subsidized loans, which jumped from 3.4 percent to 6.8 percent on July 1. [More from Manilla.com: Are Today’s College Students Getting an Education in Financial Responsibility? ] Student loan repayment options Under the new law, loan payments may be limited. Borrowers who choose the income-based repayment option will pay no more than 10 percent of their income above a basic allowance (the ceiling had previously been 15 percent).
Solving the Student Loan Crisis – Piglt Campaigns are Live
Los Angeles, CA (PRWEB) August 22, 2013 Piglt ( http://www.PIGLT.com ), Educations Entrepreneurial Piggy Bank, went live this week. Piglt (pronounced piglet) is the only innovative incentive-based crowdfunding platform that allows individuals to fund their tuition or student loan debt, thus solving the nation’s student loan debt epidemic and helping users find jobs through a dual focus on entrepreneurship and community involvement. Piglt just launched its inaugural batch of Campaigns on Aug 20th. Student loan debt in the US has risen above $1 trillion and the cost of higher education is skyrocketing. Thats preventing individuals from progressing socially and economically. The rising cost of higher education is preventing Americans from getting the kinds of degrees they want to finance the lives they want to lead.
Student Loans: The New Calculation
“This fall, all undergraduates, subsidized or unsubsidized, would only have to pay 3.86% interest rate for the life of the loan,” said Sen. Tom Harkin, an Iowa Democrat, whose support was key to a Washington deal. “That means real savings for borrowers.” It doesn’t apply to loans that students get from private lenders. It only affects Stafford loans, which are made by the U.S. government to help finance a college education. Students can apply through their university financial aid office.