In today’s day and age, one of the main concerns surrounding the topic of debt relief is how people are supposed to financially afford going to school. Should they take out expensive student loans for a degree and risk not being able to pay it back? Or should they have a more pay-as-you-go approach, which could end up taking years and year to complete?
While many students in Florida and around the country seem torn on what the best approach is, the White House did recently announce a “Pay As You Earn” proposed plan that could offer some debt relief to those with expensive monthly student loan payments.
Under the proposal, students would be able to pay back student loans at 10 percent of their discretionary income. The idea is that graduates would then make realistically affordable payments, while hopefully having some money left over that would stimulate the economy.
Under this plan, students would also be able to pay the 10 percent of what they earn for up to 20 years. After the 20 year mark the debt would be forgiven.
In addition to the “Pay As You Earn” proposal, the White House also estimates that another six million graduates and current students will be able to consolidation and reduce interest rates on their loans.
And while this could be good news for many Florida students and graduates, the fact remains that for some, student loan debt will continue to be a financial burden — especially for those who already have debts from other aspects of their lives, like credit cards and medical bills.
In those situations, it’s best to talk to a qualified professional to see what other debt relief options may be available to help wipe the slate clean, or at the very least, have some kind of manageable plan to pay back what is owed.
Source: Central Florida Future, “College grads get some loan debt relief,” Michael Clinton, Nov. 6, 2011