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Current Events & Hot Topics Current Events & Hot Topics

Obama Student Loan Forgiveness

Posted by on Jul. 8, 2014 at 9:36 PM
  • 72 Replies

It is my understanding this got signed into law.

Obama Student Loan Forgiveness

student at collegeEarlier in his presidency, President Obama announced a student loan forgiveness plan one that has become known as the Obama student loan forgiveness program- for students who were unable to complete their student loan payments or had already completed a significant part of their payments for a long period of time. The Obama student loan forgiveness program automatically clears the remaining debt of anyone who has made regular payments on their federal student loans for a minimum of twenty years. People in military service or who are working in other government departments might have their debts cleared even earlier than that as per Obama Student Loan Forgiveness.

Loans Eligible for the Obama Student Loan Forgiveness Program

The Obama Student Loan Forgiveness plan currently only applies to federal loans such as Perkins or Stafford loans. People who have taken out private loans can also make use of student loan forgiveness programs offered by a number of private employers, but these loans are not covered under President Obama federal program. Some private employers have programs where they will agree to pay back your remaining debt (or your debt in full) if you agree to work for them for a certain period of time. While this mostly applies to people in specialized jobs such as the healthcare sector, a number of private companies have their own policies regarding student loan forgiveness programs.

Impact of the Obama Student Loan Forgiveness Program

The hope of President Obama student loan forgiveness program is that it will help alleviate the debt burden on college graduates. A college degree is only worth so much if the individual who holds it is buried in debt they cannot manage, and the idea is to help students become debt-free as soon as possible. Our philosophy of providing financial transparency and assistance through the whole life of the paying for college and repayment process is really similar to this-we want people to be able to afford a college education, and to be able to free themselves from a relatively small debt as soon as they can.


http://www.simpletuition.com/student-loans/obama-student-loan-forgiveness/


If you’re a student loan-burdened recent college graduate putting the final touches on a note to President Obama, thanking him for his recent executive order on debt repayment, don’t get too excited.

Mr. Obama formally widened the pool of eligible participants in the Pay as You Earn program (PAYE) and said it could save recent graduates hundreds of dollars every month, helping an additional five million people manage their student debt. It fulfills a promise — made in a chipper, animatedadvertisement posted to Mr. Obama’s YouTube channel in 2011 — that graduates would not have to make student loan repayments greater than 10 percent of their income.

But if you look at the numbers closely, PAYE saves you money only if you borrowed big and earn little.

RELATED COVERAGE

The revised program caps monthly loan payments at 10 percent of discretionary income, defined as income exceeding 150 percent of the federal poverty level for a single person. Well-paid graduates and those working minimum-wage jobs will dedicate equal proportions of their income to paying off debt.

http://www.nytimes.com/2014/06/24/upshot/obamas-move-to-help-students-is-not-as-forgiving-as-it-seems.html?_r=0


Thoughts?

by on Jul. 8, 2014 at 9:36 PM
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Replies (1-10):
jessilin0113
by Platinum Member on Jul. 8, 2014 at 9:42 PM
3 moms liked this
Wish it worked on mine. :(
stormcris
by Christy on Jul. 8, 2014 at 9:44 PM
2 moms liked this

I think it may be sending the wrong message. Borrow up and we will forgive it but if you don't need much or tried to not rack up debt then you are not worthy.

Quoting jessilin0113: Wish it worked on mine. :(


supermonstermom
by Silver Member on Jul. 8, 2014 at 9:46 PM
1 mom liked this

I worked my butt off to pay off mine!!

Wonder if I can get a refund?

jessilin0113
by Platinum Member on Jul. 8, 2014 at 9:46 PM
4 moms liked this
I don't know. If you've been paying for twenty consecutive years,I have no problem letting that go. Mine are my own problem since I dropped out of school and ran out of deferments. I should have to pay those back.

Quoting stormcris:

I think it may be sending the wrong message. Borrow up and we will forgive it but if you don't need much or tried to not rack up debt then you are not worthy.

Quoting jessilin0113: Wish it worked on mine. :(

ReadWriteLuv
by Silver Member on Jul. 8, 2014 at 9:47 PM
1 mom liked this
I'm trying to figure out how this would help me. If I make my regular payments, on time, for he next 20 years then my debt will be forgiven? And my payment can't be more than 10% of my monthly income? That doesn't really help me at all.
quickbooksworm
by Silver Member on Jul. 8, 2014 at 9:51 PM
Some people had no choice but to rack up debt. My mom made too much to qualify for grants but either couldn't or refused to pay for my education. I worked full time in college on top of attending classes 30 hours a week (some classes don't earn credits hour for hour). I racked up quite a bit then after 9/11 my chosen field which was thriving took a dump. I've made do but I won't pay it off before I either have to save for my son's college or I incur his debt as well. The cycle has to he broken somewhere.

Quoting stormcris:

I think it may be sending the wrong message. Borrow up and we will forgive it but if you don't need much or tried to not rack up debt then you are not worthy.

Quoting jessilin0113: Wish it worked on mine. :(

stormcris
by Christy on Jul. 8, 2014 at 9:53 PM

True. Otherwise it becomes a trap.

Quoting quickbooksworm: Some people had no choice but to rack up debt. My mom made too much to qualify for grants but either couldn't or refused to pay for my education. I worked full time in college on top of attending classes 30 hours a week (some classes don't earn credits hour for hour). I racked up quite a bit then after 9/11 my chosen field which was thriving took a dump. I've made do but I won't pay it off before I either have to save for my son's college or I incur his debt as well. The cycle has to he broken somewhere.
Quoting stormcris:

I think it may be sending the wrong message. Borrow up and we will forgive it but if you don't need much or tried to not rack up debt then you are not worthy.

Quoting jessilin0113: Wish it worked on mine. :(


trippyhippy
by Gold Member on Jul. 8, 2014 at 10:01 PM
1 mom liked this

Payed mine off years ago.every month for 10 years.

littlemoments99
by Member on Jul. 8, 2014 at 11:37 PM
3 moms liked this

Paying off others loans robs those who have paid their way through college and those who have paid off their loans. I don't agree with it. If you took out loans, it's not my job to have to pay for it. I took out one $1,000 loan and paid it back. Dh didn't take out any loans. He worked his butt off and he said if he ever hadn't had enough money to pay for one of his semesters, he would have taken time off to work full time until he did have enough. 

pvtjokerus
by Platinum Member on Jul. 8, 2014 at 11:42 PM
2 moms liked this

I think that the democrats need to pay for these loans out of their tax dollars. 

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