cap monthly student-loan payments

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Mar 21, 2006
Las Vegas NV
Repaying a student loan could soon be a little less painful.
Starting this week, anyone with a federal student loan can apply for a program that caps monthly payments based on income, and forgives remaining balances after 25 years.
Those choosing to work in public service could have their loans forgiven after just 10 years.

Eligibility for income-based repayment (IBR) is determined by a person's income and loan size.
A calculator at can help borrowers determine their eligibility for the plan, which becomes available Wednesday.
"It's a way to borrow for college without going to the poor house," said Lauren Asher, the president of the Institute for College Access & Success, a California-based nonprofit that runs the Project on Student Debt.

Monthly payments would amount to less than 10 percent of income for most of the estimated 1 million people expected to enroll, experts say.

Payments would never exceed 15 percent of any income above about $16,000 a year (or 150 percent of the poverty level).

Those who earn less than $16,000 would not have to make any monthly payments.

The new payment option is intended to provide relief for those who earn modest salaries and struggle under the weight of student loans for years on end.
Originally Posted By: Steve S
If you get it from the government it has been taken from someone else.

Yeah, a scheme where government gives loans to people that can't afford to pay them back...that seems familiar somehow.

Of course with this, if you do the work that gov. wants you to do, you can get your loan "forgiven" in just 10 years.
Originally Posted By: Steve S
If you get it from the government it has been taken from someone else.

Either that, or they'll just print more to cover the money that they are NOT taking from someone else.
Sounds like a good idea to me. We need more education to keep up with the world. Hope it works.
Cost of college is like healthcare-- growing at several times the rate of inflation.

Yet we still keep shoving money at both issues.

Here's a wild idea: Cap federally guaranteed loans at, oh, $20k/yr for liberal arts degrees. Let banks step out further on their own hides.

Suddenly colleges will be a little less "Club Med" in their lavish accomodations.
I haven't graduated yet (almost done with 4-1/2 years) but this sounds great
Especially with the job market the way it is over here in Michigan...
I think later this year, I will buy a house, a new car, and go back to school all at once. need a piece of that government cheese.
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Originally Posted By: LT4 Vette

What do you plan on doing once you get your degree in this bad time ?

I don't know.
The degree I'm going to obtain is pretty versatile however (Business).
I have friends who are hundreds of grand in debt and are making $10 an hour selling TVs at Best Buy, or other odd jobs. The job market is rough.

I'd never in my life advise someone to get that in debt on an education.
This is done in many countries to raise teachers and public service employees on the cheap.

What you are doing is to reduce the cost of college education and encourage people to go into public sectors. Many people aren't able to afford college, and those who did, wouldn't be able to afford paying back a student loan to be in the public sectors.

Do you really want a whole country full of criminal defense and class action lawyers?

Compare to college education, an increased supply of teachers at a reduced cost sounds like a long term investment to me.
My oldest sister had to do pro bono work for a while until she could find a job at any law firm. Now she is a Florida Supreme Court Certified Circuit Civil Mediator and makes a 'decent' living. She was in big time debt when she graduated from UM 15 yeats ago.

No doubt... an education does pay off in the long run, but you can't wait for an opportunity to fall on your lap, you got to go out there and market yourself.

Times are tough for all job seekers, its not all doom and gloom for folks looking for employent in their field.
Yeah. Leave it to people with no monetary motivation at all ..but install their kids into the system to effect it.

Definitely lock out the common folk. They don't know anything.
Originally Posted By: ThirdeYe
I don't know.
The degree I'm going to obtain is pretty versatile however (Business).

I'm in the same boat, bro. Back in college after a bunch of years. Different degree, but I guess I'll go live in my truck since the "system" decided no more work needs done.

Kinda like the nineteen-thirties, huh?
"Repaying a student loan could soon be a little less painful."

For some it will, but for many it will become more painful - like the folks who pay their taxes & think about their decisions before plunging headfirst. If a person has a less than optimal chance of landing a job that would provide a way for them to pay back their college bill, maybe they should go do something else. A liberal arts degree typically won't allow payback of a $100k college bill in a reasonable time. Maybe you shouldn't be going to that expensive school & go to one that you can afford. Of course, there is also the notion of WORKING while you are going to school to pay for it. I worked full time & went to school full time while getting my engineering degree. I knew that I could sleep once I graduated & had all the debt paid off (which occurred prior to graduation).
Originally Posted By: oilyriser
"Those who earn less than $16,000 would not have to make any monthly payments."

Does this apply to non-citizens?

We are all global citizens now so why not?
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