Presidential candidates have been talking about solutions for the rising student debt crisis. Many high-profile employers recently announced their own student loan repayment plans. Currently, less than 3% of employers are offering this perk to help indebted employees. There is no standard rules set to decide the amount some employers agree to pay a specific amount towards student loan debt of their employees. Private sector employers, stepping up for loan repayment assistance programs is a good news for student borrowers. The employers may be using it as a tool for recruitment and retention but its benefits will be experienced by millions of student borrowers. To find out the eligibility criteria, tax benefits of your company's programs talk to the human resources department.
In a written post for the huffingtonpost.com, the presidential candidate has mentioned the need to solve the student debt crisis. "It is outrageous that young people are being asked to pay interest rates that are so much higher than interest rates to buy a house, a car, or just about anything else," she Hillary.
In the post, she also mentioned forty million Americans have student debt which accounts for more than a trillion dollars and it is a very unfortunate situation with interest rates being so high. There is need of making the college education affordable and preparing plans that helps the people who have huge debts. She also emphasized on making the income based repayment readily accessible for students.
Recently, President Obama proposed a new Bill to aid student borrowers, providing them more rights. The country is facing a student loan crisis with loan debt at $28,400. President Obama has already created "Pay As You Earn Repayment Plan" and also made some changes in the current forgiveness programs. A major challenge is to improve the complaint and resolution process and for this there is a need for a centralized system that monitors student loan service. Currently, students are having trouble finding the right options for help. The student loan market is complex and the question is will the proposed bill help in solving the complexities.
The student loan crisis is rising as recent studies show 70% students finish college with a loan debt. There are loan consolidation programs like the "pay as you earn repayment plan" and "Student loan forgiveness program" but the student loan debt is increasing as a majority of student borrowers don't qualify for these programs. A major reason for the crisis is also the lack of information students have about these programs. While the government is working to make the student loan consolidation programs more flexible there is need to empower student borrowers with the right information that helps them in availing the benefits they are eligible for. Student borrowers who don't qualify for the loan consolidation benefits offered by the federal government should consider refinancing their loans through a private lender for a flexible repayment option.
REPAYE is the new student loan repayment plan. It is the revised version of the existing PAYE program. There are a few significant differences in this revised program it quashes the timing of loan constraint which was a big cause of concern for student borrowers. There is also no economic qualifier in this revised program. There are also changes in the term length, payment for married couples, and payment caps to make this program flexible and available for more student borrowers. REPAYE offers benefits to borrowers who didn't qualify for PAYE.
In a written statement Universities minister said, "As more loans are issued to new students each year, it is vital that the repayment process is robust, convenient for borrowers and working efficiently to ensure the sustainability of the student finance system and value for money for the taxpayer". Which indicates the government may be considering strong actions against students who avoid repaying their loans. "We will take stronger action to trace borrowers including those overseas, act to recover loan repayments where it is clear borrowers are seeking to avoid repayment, consider the use of sanctions against borrowers who breach loan repayment terms and, if necessary, prosecute," he said. These strong steps are to improve the repayment process and ensure the student finance system remains sustainable.
Donald Trump recently spoke on the student loan crisis. In an interview, Trump said, "That's probably one of the only things the government shouldn't make money off. I think it's terrible that one of the only profit centers we have is student loans." While he offered no information on the immediate steps to reduce the burden of student loans. He discussed the need for creating jobs in the private sector. "I don't want to raise the minimum wage. I want to create jobs so people can get much more than that, so they can get five times what the minimum wage is," said Trump.