What is the Obama Student Loan Forgiveness Program

Student loans are one of the biggest causes of debt in the United States. President Obama, who was elected in 2008, proposed the Obama student loan forgiveness program in fall of 2011. This program was actually part of his election campaign back in the year 2007. The idea of this plan is to eliminate a certain amount of debt that is affecting a large amount of Americans. This plan only applies to federal student loans.

Are You Eligible? - Verify Eligibility Here 

obama forgiveness eligibility What is the Obama Student Loan Forgiveness Program

(Help Is Available to Confirm Eligibility - Click Here)

His plan has no impact on any private loans taken out by students to pay for college education. President Obama’s biggest saying in this is a college education is only worth so much when the debt you receive is so high. This statement can be controversial because other people tend to believe a college education is a priceless necessity for a successful life.

Although Obama’s loan forgiveness program has been introduced numerous times over the past four years it was not till spring 2012 that it actually became effective. The stipulations get kind of tricky though. Currently this plan only applies to those who borrow before July 2012. There is currently no information on current borrowers who take out federal student loans after this point. So the biggest question seems to be is how the Obama student loan forgiveness program works.

What is the Obama Student Loan Forgiveness Program 300x200 What is the Obama Student Loan Forgiveness Program

How Obama Student Loan Forgiveness Program Does Work?

The Obama student loan forgiveness program works by capping interest rates on federal student loans before the date of July 2012. After that the plan takes your current income and makes your payments only 10% of your income. It does not matter if you make more in the future. The rate stays at 10% of your income and is to never exceed that amount. There is also a clause in his plan that states if you consolidate your federal student loans 0.25% of the monthly payment will be reduced and even an additional .25% if you agree for the payment to automatically be taken out of a certain funding account whether it be a checking and or savings account. The only other benefit under the plan is that you can now get economic hardship forgiveness for ten years. Previously deferments and things of this nature were only up to a year. This is a huge benefit if something happens to your physically, mentally, financially, or basically anything that interferes with your ability to currently pay any amount on your student federal loans.

Are You Eligible? - Verify Eligibility Here 

obama forgiveness eligibility What is the Obama Student Loan Forgiveness Program

(Help Is Available to Confirm Eligibility - Click Here)

Lastly there are stipulations to even being eligible for this plan. The stipulations are pretty high and would really only help students who had been out of college a certain amount of time. The plan requires that you have made a minimum of one hundred and twenty payments already that usually equal about ten years already that you have been paying on your loans. It is also required to be a United States citizen, that you completed your college education, that none of your loans are in default, and of course that you have taken out a student federal loan.

As you can see the Obama student loan forgiveness plan is a great plan to those who are eligible and can be a great benefit. The biggest issue with this plan is that many students will never be eligible and then actually need the plan. The plan definitely has a good basis and hopefully will be edited over the next few years or a new plan will come into place.

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