When President Obama puts pen to paper today on the final version of a health care overhaul bill, he'll also be changing the course of the nation's student loan program.
Along with the adjustments Congress made to the health care aspects of the bill was a revamping of the way student loans are administered. The President will be breaking down exactly just what that will mean for college students when he speaks at Northern Virginia Community College's Alexandria campus at 11:05am Watch it LIVE now!.
Starting July 1st, when the government issues student loans, it will bypass the banks who have traditionally provided them, and directly target borrowers.
A White House press release spells it out this way, "[A]ll new federal student loans will be direct loans, delivered and collected by private companies under performance-based contracts with the Department of Education. According to the non-partisan Congressional Budget Office, ending these wasteful subsidies will free up nearly $68 billion for college affordability and deficit reduction over the next 11 years."
But some in the President's own party say eliminating the middle man also equals eliminating jobs.
But the President's focus today will be more about what the bill does than what it does not.
He will also talk about the provision's less controversial expansion of Pell Grants, as well as supporting historically black and minority institutions and caps on student loan repayments.
According to the White House, "New borrowers who assume loans after July 1, 2014, will be able to cap their student loan repayments at 10 percent of their discretionary income and, if they keep up with their payments over time, will have the balance forgiven after 20 years."
Vice President Biden's wife, Dr. Jill Biden, is a teacher at NOVA and will introduce the President.
Mr. Obama will announce that he has asked Dr. Biden to host a White House summit on community colleges this fall, with the purpose of "educating our way to a better economy," says a senior administration official.
A senior administration official says today's remarks are targeted to people around the country who don't know what the plan is all about.
So just how many private companys are going to give out loans knowing that there's a good chance that the whole loan amount won't be repaid? Because as I read that statement, I see that "if they keep up with their payments over time, will have the balance forgiven after 20 years.". In other words, the whole loan amount will never be repaid, hence....lost revenue for the bank or loan company that gave out the loan.
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A government big enough to give you everything you want, is big enough to take away everything you have.
He will also talk about the provision's less controversial expansion of Pell Grants, as well as supporting historically black and minority institutions and caps on student loan repayments.
Great... My son has been looking into college funding recently. He informs me that there are virtually ZERO scholarship opportunities available for upper middle class white kids. But, it is imperative that we support historically black and minority institutions. Whatever happened to the whole "content of their character" dream?
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According to the White House, "New borrowers who assume loans after July 1, 2014, will be able to cap their student loan repayments at 10 percent of their discretionary income and, if they keep up with their payments over time, will have the balance forgiven after 20 years."
Hmmmm.... I wonder how they define "discretionary income." Is that net after car payment, house payment, utility payments, retirement plan contributions, etc., etc., etc.? If so, someone could get $50,000 in student loans, finagle their "discretionary income" down to about $10.00 per month, pay back $1.00 per month for 20 years, and then have their balance forgiven... That BHO... a real financial wizard.
[quote][Hmmmm.... I wonder how they define "discretionary income." Is that net after car payment, house payment, utility payments, retirement plan contributions, etc., etc., etc.? If so, someone could get $50,000 in student loans, finagle their "discretionary income" down to about $10.00 per month, pay back $1.00 per month for 20 years, and then have their balance forgiven... That BHO... a real financial wizard/QUOTE] My point exactly, except you broke it down better!!
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A government big enough to give you everything you want, is big enough to take away everything you have.
[quote=ipscshooter;3604297]My son has been looking into college funding recently. He informs me that there are virtually ZERO scholarship opportunities available for upper middle class white kids. But, it is imperative that we support historically black and minority institutions. QUOTE]
ipsc- Your son is correct in this fact about ZERO scholarships. Here's a little true story to substantiate his findings...
When I was in high school, I scored #4 in my class in college placement exam. There were three females ahead of me. Two of us in the top four applied to the same somewhat prestigious university. She got in, I did not. There was also a female minority who was nowhere near the top, but she got in to the university as well. Obviously, I was not happy with the results, so I went straight to the counselor's office. These are her exact words, which I will never forget: "You are an upper middle class white male, there's no way they're letting you in. You might as well apply somewhere else."
I was then almost suspended for pointing out that this was total bs, which school officials don't like students cussing in school, or at the counselors.
Long story short- your son has an uphill battle. His grades or extracurricular activities won't matter at all. He should have been born a "minority" (whatever THAT means) and he would've gotten in, and with free $$$ to boot. But of course, if he was a minority, you might have been upset with your spouse. That's a whole different matter.
Tell me about it. My stepson had brain tumors, which ultimately took his life. At the point when he was no longer able to work, we tried to get him on disability. We had to provide affidavits from doctors, teachers, employers, all attesting to the problems his tumors caused. We still were required to take him to multiple government doctors and optometrists to substantiate his claims. The case worker's comment: "This would be easier if you weren't white."
Seems that that whole concept of judging people by the content of their character rather than by the color of their skin doesn't apply if you're white...
Yep, you better be a minority if you want a student loan. The sign "No Whites Need Apply" just got put on the front door.
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John Adams “The moment the idea is admitted into society that property is not as sacred as the laws of God, and that there is not a force of law and public justice to protect it, anarchy and tyranny commence.”
Ronald Reagan: 'Everybody that is for abortion has already been born'
"I never said I was worth it. I only said I wouldn't do it for less " William F. Buckley Jr.
Obama Breaks Down Student Loan Overhaul
