Learn more about Obama and Family

Full width home advertisement

Post Page Advertisement [Top]

The Truth about Obama Student Loan Forgiveness :

If you have qualifying federal student loans, you may be able to reduce your payments, or have your loans forgiven, through Obama student loan reform.

In 2010, President Obama signed into law the Health Care and Education Reconciliation Act, and ushered in a new era of student loan repayment and student loan forgivenessoptions.
And while it isn’t the official name, the act has been labeled by many Americans as the Obama Student Loan Forgiveness Program. However, rather than just reforming one single program, the act transformed nearly the entire student loan landscape.
Here’s how the act, which we’ll refer to as the Obama Student Loan Program, impacted federal student loans once it went into effect:
  • Subsidies are no longer given to private lenders for federally-backed loans
  • Starting in 2014, new student loan borrowers can qualify for monthly payments that equal 10 percent of discretionary income
  • New borrowers can qualify for student loan forgiveness in 20 years instead of 25 years
  • Minority students will have better access to student loans and colleges will receive additional funding
Beyond these benefits, how did President Obama help with student loans exactly? Here are some more details to help you get started.
Discover if you qualify for an Obama forgiveness program right now for free.


Obama Loan Forgiveness Programs Available

Since the Obama Loan Forgiveness Program affected several existing federal student loan programs, there are a number of ways to qualify for each.
For more information on each program, click on the following links to explore how the individual Obama forgiveness program can help you.

Standard Repayment Plan

If you have federal student loans that qualify, the Standard Repayment Plan lets you pay off your loans at a fixed rate for 10 years, after which your loans will be paid off completely.

Income-Contingent Repayment (ICR) Plan

To qualify for the Income-Contingent Repayment (ICR) Plan, you’ll first need to have eligible federal student loans.
While the ICR Plan is ideal for anyone with a low income, there isn’t an income requirement associated with the plan. Through this program, your monthly payments are based on your discretionary income, or the amount you’d pay over 12 years on a fixed repayment plan.

Income-Based Repayment (IBR) Plans

There are two IBR programs available, including the original Income-Based Repayment (IBR) Plan and the IBR for New Borrowers Plan. Like other plans, you’ll need to have federal student loans that qualify, and you’ll also need to sign up for the program that is designed for when your loans originated.
For the IBR Plan, these are any loans made prior to July 1, 2014. IBR for New Borrowers, on the other hand, are for loans originating after that date.
Another requirement you will need to demonstrate is a partial financial hardship, which is based on your income, your state’s poverty level and your family size.
Through these programs, you can have your monthly payments capped at 10-15 percent of your discretionary income if you qualify, which is a huge benefit to struggling borrowers. Your payments will then be adjusted annually, but you could earn forgiveness after 20-25 years of qualified payments.
For more details on Obama Loan Forgiveness, speak with student loan specialist by phone at 800-771-6358.

Pay As You Earn (PAYE) Plans

As part of the Obama Student Loan Forgiveness Program overhaul, both Pay As You Earn (PAYE) and the new Revised Pay As You Earn (REPAYE) programs were set into motion.
The PAYE Program offers those with qualifying federal student loans under financial hardship the ability to repay student loans made before October 1, 2007 – as well as disbursed or consolidated loans made on or after October 1, 2011 – at 10 percent of discretionary income.
The REPAYE Program is similar to the PAYE Program, but includes all qualifying federal student loans, regardless of their origination date. Like the PAYE Program, monthly payments through the REPAYE Program are capped at 10 percent of your discretionary income.
Both programs offer forgiveness after 20 years of qualifying payments, unless you have earned a graduate or professional degree, in which case you will need to make 25 years of consistent payments in order to qualify.

Graduated Repayment Plans

If you’re interested in reducing your monthly payments for a short period of time, the Graduated Repayment Plan, the Extended Fixed Repayment Plan and the Extended Graduated Repayment Plan may be able to help.
With qualifying federal loans, the Graduated Repayment Plan will reduce your payments for the first two years upon approval. During this time, you’ll only be making payments towards your loan’s interest.
Once the two years are up, more of your payments will go towards a loan’s principal, and your repayment period will be based on your balance.
If your student debt is more than $30,000, the Extended Fixed Repayment Program may help, as long as you have loans that qualify and don’t have any outstanding balances prior to October 7, 1998. For the first two years under this program, all your payments will be made towards your loan’s interest at a fixed payment amount. After two years, you’ll then begin paying towards your principal, and you’ll have up to 25 years to repay your loan.
The Extended Graduated Repayment Plan is similar to the Graduated Repayment Plan, except it gives you up to 25 years to repay your student loans, while keeping your monthly payments low for the first two years.
These plans are ideal for anyone who has a lower income and is expecting to make more money in the near future, or those who want to have more of their income to spend for the initial two years of each program.
Find out if you can take advantage of Obama Loan Forgiveness for free.

No comments:

Post a Comment

Get Obama Loan Today

Bottom Ad [Post Page]

| Designed by LogoDesign.cm