There are two Federal programs that have been established to relieve student loan debt for those recent graduates who may be struggling to find a place in the flagging employment market.
According to educational professionals such as Terry Hartle, the senior vice president of the American Council on Education, these new programs are being billed as some of the most elaborate and broadest set of provisions ever instituted to reduce the burden of student debt.
Since this new measure was implemented on July 1, many student borrowers have been allowed to put a cap on their monthly payments at a reasonable amount that is based on factors such as income and family size.
The second plan that is being used to treat student loan debt is called the Public Service Loan Forgiveness Program. Under the provisions of this program, student graduates who are eligible would be able to erase all student debt after ten years. Eligibility would be limited to those graduates who are employed government or various non-profit organizations.
Of course, the income-based repayment program is being made available to borrowers who have used any federally guaranteed loan. The loan-forgiveness program is for those students who have received direct federal loans. Unfortunately, neither of the new programs is available to students who have private loans.
Authors of the new legislation have admitted that they do not know exactly how many of estimated 30 million student borrowers in the United States would qualify for the either of the two programs.
In just ten years, the levels of student borrowing have experience sharp increases in an effort to keep pace with the exorbitant costs of tuitions. Based on figures released by the non-profit College Board, total education lending across the country, adjusted for inflation over time, increased from $41 billion during the 1997-98 academic year to $85 billion in the 2007-08.
The average borrower finishes college owing more than $22,000.
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