It is expected to become law, with support from the White House and the House of Representatives, which will likely take up the bill in coming days. “This fall, all undergraduates, subsidized or unsubsidized, would only have to pay 3.86% interest rate for the life of the loan,” said Sen. Tom Harkin, an Iowa Democrat, whose support was key to a Washington deal. “That means real savings for borrowers.” It doesn’t apply to loans that students get from private lenders. It http://www.obamastudentloanforgiveness.net/ only affects Stafford loans, which are made by the U.S.
Like the mortgage market, Chopra noted, the $1.2 trillion a year industry is backed primarily by the federal government. And the debt is onerously collateralized, with options such a wage garnishment impacting borrower repayment activity. “We are already seeing signs of economic drag from student loan debt,” Chopra said. “The impact on the housing market is the most troubling part.” Chopra dispelled the “myth” that quantitative easing benefits the student loan space. Despite keeping historically low rates everywhere else, most student loans are not variable and typical charge 8% or above.
CFPB: Student loan debt hijacks the housing recovery
A spokeswoman for the chairman of the House Committee on Education, John Kline of Minnesota, said the committee has been collecting input from higher education groups, including historically black colleges and universities (HBCUs), and will be exploring those issues leading to the renewal of the Higher Education Act. SAYING SORRY Representatives for HBCUs and minority students said they feel burned by the DOE’s sudden change to PLUS loans in 2011. “That one took our schools and the higher education community by surprise, because no one knew it was coming,” said Cheryl Smith, senior vice president of public policy and government affairs for United Negro College Fund (UNCF). “They did it without telling anybody.” The DOE later explained it made the changes to PLUS loans to bring underwriting standards in line with other types of loans. Education Secretary Arne Duncan has since apologized for the poor communication, and has said his department will start a new rulemaking process early next year. Bowing to pressure from the groups, the DOE has also put in place an appeals process for parents denied PLUS loans.
Suze Orman takes on the student loan crisis
There are four companies processing or collecting student loans, and a fifth, Wells Fargo, will be opening a branch office here soon. The companies account for 384 jobs, with some firms adding positions. One aspect of the student loan business collections is likely to continue to grow. The default rate on student loans has risen for the sixth year in a row, according to data released last week by the U.S. Department of Education .
Four companies in Aberdeen process, collect loans
The story worsens when you factor in interest rates and ramifications for not paying on school debt. “It’s a real travesty what is going on in our country with student loans and our children,” stressed Orman. “Students are paying more in interest on student loans than what they pay for a car or a mortgage, and those loans (auto and mortgages) can be discharged in bankruptcy,” said Orman. Unlike with most debts, the current federal law states that student loans cannot be dissolved or written off in a bankruptcy. This is a point of contention for Orman, who said “I couldn’t agree with Sen.