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  • Student Borrowers at an advantage with the Obama Administration
  • Posted By:
  • Jamie K
  • Posted On:
  • 09-Feb-2016
  • As we are aware that the U.S. is gaining popularity where student education is concerned and you have many students opting for America for their higher education. There are many reasons for this and some of them include

    !. Institutions which are considered world class for learning.

    2. Institutions which are recognized worldwide.

    3. Supporting research and training besides industries.

    4. Culture and people.

    5. Flexibility and Technology

    6. Global focus and campus experience

    Student Loans with the Obama Administration

    * The budget released for the year 2016 has been able to concentrate on the Student Loans. According to this, the President intends to streamline and reform repayment which is income-driven so that students who require these loans are benefitted to the maximum. The Pay as you Earn plan will be the only repayment plan which is income driven for those who originate their loan after or on July 2016. At this moment loan borrowers have a number of options for income-driven repayment. The eligibility for each of these plans is different depending on the age and the type of loan.

    * Repayment which is income-based caps payment at 15 percent of the borrower’s income and the balance which is remaining is forgiven after payment for 25 years.

    * Pay as you Earn works out to be a generous form of repayment but is open only to recent borrowers. This is able to cap payments at almost 10 present of incomes which are discretionary and is able to allow forgiveness after 20 years. This proposal of the president will make this Pay as you earn the only plan which is income-driven with stricter benefits and limits.

    * Student loan borrowers of the graduate level with $57,500 as balances would be eligible for the
    forgiveness factor after a time period of 25 years and not 20, besides which payments which are made under plans which are non-income driven would not be counted towards forgiveness of student loans.

    * Borrowers who are married would not be permitted to exclude the income of their spouse from the repayment calculation which is income-based   by filing for separate returns of taxes.

    Perkins Loans

    These Perkins Loans are need-based with interest rates and loan limits being on the lower side as compared to the PLUS and Stafford loans. These loans are repaid to the institution of higher education directly unlike the Stafford and PLUS loans. In accordance to the proposal of the President these Perkins

    Loans would end and a new unsubsidized loan would replace these. These new loans would have the same terms and conditions and the interest rates as the Stafford loans which are unsubsidized and the U.S. Department of Education would directly service these. The limits for these loans would be the same Making Higher Education more Comfortable in the United States

    Since there has been a rush to pursue higher education in America, the Obama administration is
    continuously making changes to ensure that students, be it Americans or international students, are able to complete their degrees and are not overly burdened with loan to be repaid. There have been constant proposals by the administration to ensure comfortable completion of higher education by most of the students.

    The Obama administration has pursued actions and put forward policies addressing flaws which are structural in the system of higher education. Let us go through some of the changes intended by the Obama Adminstration to ensure quality higher education in the United States.

    1. The Obama Administration has been able to stop the flow of the federal dollars to college programs which are considered as low-performing for careers that tend to leave students in debt with few opportunities to be able to repay these. This has been done with the help of the Gainful Employment Regulations.

    2. The budgets by the Obama administration has been able to reward those colleges that are able to do a good job of graduating and enrolling a good number of students of the lower income on time via the College Opportunity and Graduation Bonus. Schools that are able to provide quality education at a price considered reasonable are given federal student aid which is campus-based.

    3. Community colleges are encouraged by the ACP (America’s College Promise) to strengthen the
    programs and also make sure to increase the number of students graduating by adopting institutional reforms which are based on evidence and also practices which are innovative to improve the outcome of the students. The ACP is able to ensure that the academic programs of the community colleges are transferable and that there is a high rate of graduation in their training programs which lead to credentials in demand.

    4. The ACP would continue encouraging reforms which would help in college completion besides which states would be encouraged to continue investments in higher education and also fund colleges using outcomes based on student performance .

    5. This administration has also proposed certain regulations to reward and recognize teacher
    preparation programs which speak of high-quality with the eligibility of TEACH GRANT and also
    encourage all the programs to make improvements through accountability and t5ransparency which s driven by outcomes.

    6. Students will be encouraged to complete their education on time by stressing on requirements for progress in academics in the programs for federal student aid.

    7. The Obama Administration has been able to increase the transparency for families and students so as to ensure they are able to make decisions which are informed through the Financial Aid Shopping Sheet and College Scorecard tools. This can help the students choose a school which is affordable and can be considered as apt for their career goals. With these tools families and students can compare the fees of the different educational institutions and opt for the one which fits their requirement.

    The Obama Administration intends strengthening accountability in higher education and helps the
    students complete their education well on time without being in debt.





 

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