OBAMA’S STUDENT LOAN FORGIVENESS PROGRAM A GUIDE TO THE WILLIAM D. FORD ACT ----------------------------------------------------------------------------------------------what is president obama’s student loan forgiveness program? President Obama recently introduced a new student loan forgiveness program, which offers significant advantages to those who have utilized federal student loans. These include:
complete forgiveness of federal student loan debt after borrowers have made 240 monthly payments introduction of the pay as you earn student loan repayment plan updates to the public service loan forgiveness program (complete forgiveness after 120 monthly payments) the president’s student loan reforms are discussed here in detail, and the site will be updated whenever relevant news is announced. be sure to check back throughout 2015 for the formation, proposals, and implemented changes relating to Obama’s student loan forgiveness program.
first, let’s cover some of the most recent news.
$3.6 billion in forgiveness for Corinthian college’s students
Campuses affiliated with Corinthian colleges recently received a piece of very important news. on june 8th, 2015, president Obama’s department of education announced that they will be
offering student loan forgiveness for up to $3.6 billion dollars for student loans distributed to those attending any campuses associated with Corinthian colleges.
the Corinthian 15 debt strike resonated deeply amidst lawmakers in Washington, d.c., leading many to believe that politicians and banks are becoming frightened of the potential for the student loan debt strike taking root with the rest of the general population as well.
for those who are unfamiliar with Corinthian, here is a bit of background about this network of schools. they consist of a large chain of for-profit colleges, all of whom advertise extensively on daytime television and are notorious for overcharging their students and inflating expectations. some of the Corinthian colleges which you may have heard of include Everest, heald, and wyotech universities.
the general public is becoming increasingly jaded about the high cost of education in general, but Corinthian students have taken a particularly bad hit, and people are wising up to the scam. the Corinthian network collapsed under the weight of federal investigations responding to rampant abuse allegations, and since this system posed a serious threat to the increasing student loan debt bubble, many believe that this is a good thing.
justice has, fortunately, been served. president obama’s administration is now promising significant forgiveness benefits for a select number of students who are scammed by corinthian. Unfortunately, the downside to this otherwise fantastic step forward is that the
forgiveness offer is limited to people who attended a corinthian-affiliated school on or after june 20th, 2014.
even with these limitations set in place, this is still a vast improvement. the forgiveness offer sets a great precedent for the response to excessive student loan debt, and shows that the president has concern for american youth struggling under the weight of student loan debt.
President Obama’s student aid “bill of rights” It will make many students pleased to hear that on march 10th, 2015, president Obama announced a brand new initiative that his administration is calling the “student aid bill of rights.” this bill of rights introduces some changes to the policy regulating federal student loan debt, and promises to tackle three very significant issues. the bill of rights will do the following: create a complaint system that borrowers can use to file official complaints about loan servicers, debt collectors and department of education personnel make it easier for borrowers to pay off their federal student loans by modifying the existing obama student loan forgiveness program and increasing access to the pay as you earn student loan repayment plan launch a new federal task force focused on researching the problems related to student loan debt, and dedicated to finding new solutions via proposed legislative and regulatory changes the most important part of the “bill of rights” is that it will very likely be open to everyone by as soon as December 2015. The president is committed to opening up a universal pay as you earn repayment plan by December 2015.
More great news has been released!
as of february 2015, the dust has had time to settle on the passing of the “cromnibus” proposal. for those of you who are unaware, this refers to the approval of president obama’s 2015 federal budget. well, by now it’s become quite clear that the only changes being considered for the president obama student loan forgiveness program are positive ones that will impact the american public in good ways.
some of these changes include the introduction of two significant objectives: the pay as you earn student loan repayment plan, and the public service loan forgiveness program.
back when talk of this proposal was first released in march 2014, we had a slightly more cynical attitude towards it. if you review our previous discussions about the issue, you’ll see that at the time, when less information had yet to be revealed, we were seriously concerned about some of the proposed limitations being considered for these programs. many other people were worried, too, particularly because the changes would have reduced their effectiveness at helping people wipe out excessive student loan debt.
thankfully, the language of the approved 2015 federal budget tells a more positive story. it doesn’t appear that any of the previously proposed nerfs will actually be made law in the near future. in fact, none of the changes were even mentioned at all in the cromnibus, signaling that washington politicians may be abandoning their attempts to cut benefits from the excellent federal student loan forgiveness programs.
you may be thinking that this is just politics as usual, and that the upcoming re-authorization of the higher education act talks will allow for the re-introduction of these cuts in benefits. but are they really out of consideration for good?
it’s difficult to tell at this point, but for now, it seems that this student loan forgiveness program and all its many benefits appear to be safe. in fact, this program could easily save people tens to hundreds of thousands of dollars on their federally-funded student loans.
For more information about visit student loan forgiveness program