Recently President Obama outlined proposals to help students who are attempting to repay their college loan debt as more affordability, changes in forgiveness options, and potential reductions in payments could help numerous students who are graduating or have already graduated but are facing a sizable amount of student loan debt as a result of high costs that are being seen for university and college tuition. Currently, graduates are questioning how this may be beneficial for their repayment options and students who are in school and having to borrow loans are looking at these proposals as a way to potentially find more affordability if they do have to borrow to meet certain costs while acquiring their degree.
Understandably though, there are students who are in a position where lower monthly payment options, and potentially earlier forgiveness options, could be more beneficial as it was reported that some students may be able to have their debt forgiven after 20 years of repayment, rather than 25 for those who are falling outside of the 10 year forgiveness option that some graduates have, but when it comes to students looking for ways to find more affordable payments on their student loan debt, there are still some opportunities available specifically on federal loans that may be beneficial.
While changes that have come in the area of student loan debt have brought about mixed reviews, there are those who are calling for student loan forgiveness on a wide scale but as debt from student loans has increased to almost $1 trillion there are few who feel that allowing forgiveness on a majority of college loans would be helpful to the economy, and have proposed that more affordability options be made available to students who are having to repay their debts during a time where job opportunities are simply not available to the extent where honoring this debt in a timely manner is achievable.
Students with federal loans have opportunities to consolidate their debts, which can bring about more affordable monthly payments, but there are also some options like an income-based repayment plans that have been used by students who are simply having trouble meeting their student loan payment or may have multiple debt obligations that have been quite costly in terms of what they can pay. Some graduates are missing payments are even defaulting on their debt, which is obviously going to be a setback for the economy as well, and some have even gone so far as to say student loans may be the next bubble to burst, but if more affordability can be offered to graduates it could help alleviate financial distress for many graduates, and this could also go a long way when it comes to helping graduates in their personal financial lives as it could free up money for other purchases or debts.
While some of the changes that have been proposed will be starting in 2012, it does need to be remembered by students currently suffering from financial setbacks there are options such as federal loans, opportunities to find an affordable repayment plan are available and resources from the Direct Loan program may help students better explore what aid is available for their federal loans in the hopes that fewer students will be suffering from financial distress as a result of paying back their college loans and, in the long run, it may help reduce missed payments or defaults on college loans as well.