Everyone knows the value of a good education. In a highly modernized and competitive society as we have now, having a thorough training and formal education is a must. However, getting one can be a problem due to one’s finances. Here is where the Obama student loans enter the picture.
A good part of the youngster population today has learned early on how important it is to finish a degree in college. This is a basic qualification for one to land a good job and have a great career in the long run. Because of such realization, one can see a lot of college students funding their education in any ways they can.
One of the most common things these young people utilize to help them in their goal is by student loans. Basically, these are money taken out to pay for tuition and other expenses incurred in one’s college education. In return, one has to pay for the loans with their respective interest once one gets a job.
All this might sound like a good idea, and it really is until the time when the payments have to be made. Students are faced with as much as $700 monthly payments right after their graduation. As a result, working professionals who finished college through student loans are still in a bind.
It is a good thing that the Obama student loans exist. Basically, this is a controversial reform that is designed to help college students in dealing with how they finance their education. It is more popularly known as the Obama Student Loan Forgiveness Plan.
With the Loan Forgiveness Act, students get a chance to lessen the years they have to spend paying for the entire amount borrowed for their education fund. The 25-year loan is reduced to 20 years given that the borrower pays the monthly dues without any default for the first 20 years.
Another benefit comes in the form of the payment percentage. The current level is at 14 percent of the individual’s discretionary income, which is the money left after the taxes and basic necessities have been paid for. The percentage level is reduced to 10 percent, which is definitely more manageable.
Although Obama student loans are generally good, there are certain limitations that make them unfair for others. An example of which is the discounts given to public servants who have worked for at least ten years. Not everyone gets to last that long in said position due to one reason or another.