Student Loan Changes that Help Borrowers
Student Loan debt is a big problem in America. It is one of the main contributing factors to debt, according to Attorney Mike Ziegler, so it makes sense that big changes are in order. Here are some recent student loan changes that will help borrowers.
Mike Ziegler Reveals the Best Changes for Student Loan Borrowers
REPAYE
This program, introduced in December of 2015, is the Revised Pay As You Earn program. Borrowers of Federal student loans who need lower monthly payments can now opt for this program.
The revised program allows an additional five million direct loan borrowers to obtain relief, a vast improvement from the original Pay As You Earn program. Borrowers can cap their monthly student loan payment at only 10% of their income, which used to be 15%. When the loan originated does not play a factor in this percentage.
The program forgives any graduate degree debt after 25 years, and any undergraduate debt after 20 years. If you are beyond this point, make sure you seek a debt collection defense attorney before admitting to or paying any outstanding debt.
State-Sponsored Refinancing Options
Several states have begun offering their very own student loan refinancing options for borrowers.
Applying for Financial Aid
Applying for financial aid is easier than ever. Now, families can apply for Federal financial aid sooner, and get an answer quickly enough to decide on a school. This changes the game of school selection, and allows the family to choose where the student will attend based on finances. Now, the FAFSA is available by January 1st of the year it is being applied for. Since most deadlines for schools require a response around May, this leaves more time for a decision.
Loan Servicer Changes
The Department of Education will no longer give preference to Nelnet, Great Lakes, Navient, and American Education Services when it comes to student loans. Now, the department will place new loans based on the quality of a loan provider’s work and ability to keep borrowers current. This could make things better for borrowers by ensuring that they are placed with quality loan providers.
Perkins Loan is Back
The Federal Perkins Loan has been reinstated, with tougher requirements. For students in need, this is great news. Although the new stipulations require that borrowers have exhausted their other Federal loan options, students in need will have more access to the loan.
Student loan debt is a serious issue in our legal system, and the rules are continuously changing. Before you assume responsibility through a debt collector, seek legal counsel from Mike Ziegler.
Source: US News
