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New Education Loan Repayment Scheme In The US

In a sign that education is highly prioritized by the United States government, it has been offering for quite some time student loans for college and graduate students who need assistance.

The goal of the program is very obvious: to help students get on to earn degrees despite continuously rising costs.

 It is a common knowledge to everyone that US students are quite independent. That is why they are left to make ends meet and finance their own endeavors.

Thousands of college and graduate students across the country are benefiting from the program. Many are earning their degrees with much financial hassle.

 The catch is that those students are mandated and required to repay their student loans after they graduate.

This scheme is a welcome note to most students, who really are in dire need to pay for their education. But repaying loan amounts for a number of years (average about 10 years) could be a daunting task to most.

There is good news amid the current financial crisis and the pressured job market. The federal government’s Income Based Repayment program recently allowed that it would finally allow student borrowers to cap monthly loan repayments at just about 15% of total annual income.

This move is expected to particularly benefit new graduates who are faced with big loan repayments amid a tough employment market these days.

Graduates with lower income and with children would be required to pay much lower repayments monthly, or in specific cases, none at all.

This scheme would encompass federal loans, which account for around 66% of total student debts. Private loans made by students are not covered, though private lenders may always offer their own incentives.

This is obviously and logically a welcome note to all student borrowers. However, student borrowers who have already been on defaults would not enjoy the program.

It is estimated that about 60% of US students with bachelor’s degree have student loans. On the average, such students accumulate $23,000 in student borrowings.

For a typical 10-year loan repayment program, the amount would require them to pay about $260 monthly.

Medical students on the average have bigger student loans at about $106,000 each. This translates to higher monthly repayments after graduation.

Because of the new student loan repayment scheme, graduates who earn about $30,000 annually would only be required to pay just up to $172 monthly.

Those who earn up to $40,000 annually would pay $297 monthly. The scheme is set to help those borrowers feel some ease in repaying monthly student loan dues. It is a welcome note especially these days, when the economic crisis is still very much felt across the US.

Graduates who are employed by public service offices are entitled to more perks. For 25-year student loans, remaining loan balances would be written off. The scheme would lower repayments by up to 10 years.

The US education system has always been a role model for many countries. The country is really a nation valuing education at most.

The student loan programs are indeed proof that the government is bent on helping the youth solidify their potential for the future.

 If only other countries could also offer the same program, many teenagers would earn degrees that would qualify them to better jobs and of course, better sources of income.

2 comments:

  1. It'll be interesting to see what sort of scheme they come up with for business loans Ft Lauderdale next. I'm expecting to see tons of people defaulting on those as well once the economy takes another dive here in the next few months.

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