Wednesday, President Obama announced his new student loan forgiveness program at the University of Colorado in Denver; Obama said that “it’s never been more important to get a college degree, but it’s never been more expensive. And, helping students pay their loans will put more money into the nation’s struggling economy.”
“Our economy needs it right now,” Obama said. “And your future could use a boost right now.”
The student loan forgiveness proposal would include Federal student loans.
The current student loan forgiveness program states that student loan payments can be capped at 15% of discretionary income, and after 25 years any remaining student loan debt would be forgiven.
Under Obama’s new program, the maximum student loan payment would be 10% of discretionary income (money left over after paying bills), and after 20 years any remaining student loan debt would be forgiven.
Obama’s proposal would take effect in 2012, and would affect an estimated 1.6 million borrowers.
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Sources: ABC News and BakersfieldNow.com
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