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President Obama Uses Executive Action to Push Student Loan Forgiveness

Jun 20, 2014

by Scholarships.com Staff

President Barack Obama reportedly issued an executive action on Monday in an effort to alleviate student loan repayment problems for those with large post-college debt and salaries that make their loan payments unaffordable.

The executive order issued by the president, pushing through a program known as the Pay As You Earn Repayment Plan would cap loan payments at 10 percent of monthly income for the borrowers of federal direct loans. Federal law currently allows most students to do this already, but President Obama's order further extends this option to students who took out a federal direct student loan before October 2007 as well as those who haven’t borrowed since October of 2011. As many as 5 million more borrowers will reportedly be affected by this extension, which will begin in December of next year. You can determine eligibility by visiting the Federal Student Aid Repayment Estimator

Opponents of the executive order are concerned by the potential of students taking out enormous loans to attend expensive schools and majoring in subjects that are unlikely to prepare them for (or align them with) lucrative careers and the ability to repay the debt. This would result in taxpayers throughout the country bearing the burden of these loans, regardless of whether they or their children benefitted from a college education, let alone forgiveness of any of their debts.

For some, this is an opportunity to get out from under crushing debt, but at what cost? Where does the “forgiven” balance show up? Should the taxpayer at large shoulder this additional burden or should aspiring college students be seeking more affordable options for education and/or preparation for their professional lives?

And don't forget, you should pay for your college education with as much free money as possible! Find as many scholarships and grants as you can before turning to student loans. Visit the Scholarships.com free college scholarship search today where you'll get matched with countless scholarships and grants for which you qualify, then apply and win! It’s that easy!

Discuss

Share your thoughts and perhaps thousands of students will benefit from your unique insight on the subject!



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Michael S  on  6/26/2014 2:40:50 AM commented:

You are spot on, Emma. I'm tired of how Americans are treated like morons. We are capable of dealing with our own mistakes. Let us fail as we pick ourselves up and learn from our mistakes. Socialism collapses, look to our East. Pioneers learn from mistakes and prevail. History shows us this but then again, history is not being taught in schools so many don't know, what they don't know.

Emma M  on  6/20/2014 10:43:09 PM commented:

This is another far reaching attack by our president on hard working Americans designed to push us towards true socialism. Have we not learned anything from Europe's system collapsing as we speak? As Margaret Thatcher said, the problem with socialism is that eventually you run out of other peoples money. Who really benefits from this? The kids who get to be owned and work for the govt to pay off their big loans? Think not.

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