Posted on 10/25/2011 9:54:51 AM PDT by freespirited
President Barack Obama will announce a new plan to allow students holding both private and government student loans to consolidate their debts into a government loan, thereby reducing their interest rates, officials inside and outside the Obama administration said Tuesday.
Mr. Obama is to announce the move in Denver on Wednesday, part of a White House push to emphasize actions the administration can take to boost the economy without congressional approval.
The change could affect an estimated 5.8 million people who hold two types of student loans—those issued by private banks and "direct loans" issued by the government, an administration official said. Consolidating the two loans into a government loan would result in a lower interest rate—and therefore lower monthly payments—as well as additional loan-forgiveness and repayment options.
The president will also announce an acceleration of an income-based repayment program. Existing rules allow graduates to limit their loan payments to 15% of their income, with all debt forgiven after 25 years of payments. Congress has already passed a change to that program that would allow borrowers in 2014 to pay 10% of their income, with all loans forgiven after 20 years. On Wednesday, Mr. Obama will announce that he is speeding up this program so it will affect students beginning next year instead of in 2014.
(Excerpt) Read more at online.wsj.com ...
When I started college in the fall of 1975, my tuition for the SEMESTER was $225 at a state university. Back then I could work 10 hours a week at minimum wage ($250) for 18 weeks (a typical semester) and have enough money to pay my tuition, books and have a little left over.
Today, my minimum wage job ($8)worked over the same time line barely pays for 5 credit hours. I’m glad student loans have made college accessable for so many! (sarc)
Oops, that’s $2.50 an hour. A decimal point makes a difference!
Step 1: Roll all of the outstanding public AND private school loans into direct loans controlled by the Administration
Step 2: Float loan forgiveness schemes from now until the end of time, every time Democrats are running behind in the polls.
We are about the same age; I started in 1979 and worked my way throught school too.
But, it’s not just tuition- it’s the other fees that are nothing more than extortion. Student Activity fees, that go towards funding the Athletics Association. Student fees that amount to pre-paying for tickets to every home-game; whether you have an interest or going, or not. Fees for maintenance of Dorms, on top of paying inflated Dorm rent fees. The fees alone can easily double the bill from what Tuition costs.
Then add the books that the teachers write themselves, some bold enough to put ‘tear-out’ homework pages that are gathered; thus ensuring that next term students can never buy a used book.
Then we have the schools selling useless degrees at rates that any foolish student could never dream of repaying. I know of incredably foolish students with $200,000 in student debt for a degree in ‘Theater’. He delivers pizza, and volunteers at a local theater - and will likely never be able to pay off that student loan.
I sure did but weep isn't my reaction to this.
I'm reminded of a line from the film "Network."
This proposal would not be believable in a student-penned work of fiction. In that light, it makes perfect sense Democrats would embrace such a movement.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.