Outstanding student loan debt in the U.S. is approaching one trillion dollars. One important question people struggling with student loan debt have is whether student loans are dischargeable in bankruptcy. With certainty, the options for student loan debtors are limited. For this reason, new programs and legislation are in the works to provide relief for student debtors and affordability for new students just entering college.
In 2010, President Obama signed the Health Care and Education Reconciliation Act (HCERA) to provide debt relief for college students. The HCERA gives student borrowers new alternatives for repaying their loans. There is an income-based repayment option to cap monthly repayments at 10 percent of income for borrowers. This option applies after 2014. Loans may be forgiven in their entirety after 20 years. The president’s new “Pay as You Earn Plan” will permit about 1.6 million students to select this feature right now.
Public service workers may benefit from residual debt forgiveness after a decade. The funding under HCERA will increase the amount of resources available for Pell Grants to $5,550 today. These historic changes will be preserved in the Budget Control Act of 2011. The HCERA includes a $2 billion allocation to help community colleges expand education and job training.
The community colleges and state colleges provide needed relief from the high cost of tuition at some private colleges. Increasingly, the high schools are offering college courses in the senior year. These offerings can reduce the college experience by as much as one year in accelerated programs. In addition, the Federal Work Study Program (FWS) is another option to help students pay for public or private college.
The Hill-Burton Act provides low-cost or no-cost medical and dental care for most middle class wage earners and their families. The health care is provided by a hospital or facility with a mortgage to be paid. The facility takes poor and middle class patients in exchange for an iterative reduction in or forgiveness of the mortgage debt the facility owes. This program can help college students with medical and dental costs if their family income is within the statutory sliding-scale income limits.
Article comments
1 - Arch Conservative
Is the traditional college right after high school even worth it anymore?
It almost seems like it's more beneficial to find an entry level job right out of high school. Get a few years under your belt and then have your employer shoulder some of the costs of your education. Sure you'll miss out on all those keggers and bong hits but you gotta grow up sometime right?
2 - Dr. Joseph S. Maresca
Much depends upon what course of study a student pursues in college. If the student intends to enter
one of the major professions like medicine, law, accounting, engineering, actuarial etc., then the
investment in time and money may be worth the effort. The baby boomer generation is retiring along
with millions of professionals. Who will replace them when a tremendous void is created.
Our population has grown from 300MM to 313MM in a mere decade or so.
At some point, the demand for goods and services will increase. The main point is that a trained college
student with a brand new education will be at a premium. Much depends on the practicality of the
education received. Students need to think more about how their education will fit within a blossoming
global economy. Students who pursue the professions will have the best chance in any economy.