The sharp climb in student loan debt and student loan default in the last few years has caused a lot of political grandstanding at the state and federal level, but very little actual legislation.
And now a new angle to the debate, their is now discussion of whether it makes sense or is fair for the U.S. Government to make a profit from student loans. Recently six democratic senators sent a letter to Education Secretary Duncan stating that the Department of Education should not be in the business of “squeezing” students and that the federal government to bring in $110 Billion in student loans in the next decade.
Whether or not this number actually represents profits is debatable, since a number of student loan forgiveness programs will begin to kick-in in 2017, which fundementally change the income from student loans overall. It is unclear from the report that this number originally came from where this money is originating from.
That being said, clearly the interest and restrictions on student loan debt makes it a burden on most student borrowers and leave few options for those who come out of college with large student debt payments at the beginning of their professional careers. Many other degrees in certain disciplines, including trade school programs, often do not pay as well of certain other types of degrees and leave students on a cycle of barely paying against the principle of their student loan debt.
The best option is, of course, to educate yourself before applying to college what the lifetime value of a degree can be in a best case scenario and how you could easily make payments on your student loan debt in a worst case scenario. However, if you currently have student loan debt, your best option is to contact American Financial Benefits Center and talk to one of our representatives to learn what programs are available to you.