Parents Beware of PLUS Sized Student Loans
Parents can borrow Parent PLUS loans to pay for the education of their dependent children. My husband and I will borrow Parent PLUS loans next year for our daughter's college (unless she runs off to Uruguay, which is distinctly possible). Direct Parent PLUS loans are technically eligible for Public Service Loan Forgiveness, but not really. Because Parent PLUS loans cannot be repaid under either Income-Based Repayment or Income-Contingent Repayment, you can’t actually make payments on a Parent PLUS loan that count towards…
Five Ways IBR Beats ICR
What’s the difference between IBR and ICR? What it comes down to is that IBR is way better than ICR. Here’s why I think so. IBR and ICR are different in important ways Monthly payments are typically higher under ICR than under IBR, sometimes a whole lot higher. And ICR payments can be potentially even higher than under a 10-year repayment plan. Ouch! Score one for IBR. IBR payments are not based on how much you owe, just on your income and family size. But under ICR, how much you owe does affect how…
Congressmen Caught Helping Student Loan Borrowers
What are they feeding these congressmen lately? Private Student Lenders Should Play by the Same Rules as Other Private Lenders Restricting bankruptcy protection for borrowers of private student loans doesn’t protect taxpayer investment; instead it gives special treatment to private student loan companies that other private lenders don’t enjoy. The argument goes like this--in order to safeguard taxpayer investments in higher education, federal student loans ought to be difficult to discharge in bankruptcy. But private student loans…
Need a Senator to Love? Try Senator Sherrod Brown of Ohio
United States Senator Sherrod Brown cares about making higher education available to all, and that makes me love him. Brown just announced new legislation aimed at helping student loan borrowers and saving money for the government--at the same time. Senator Brown said, “It’s a win-win for borrowers and taxpayers—by ensuring that students can access higher education and by helping already-strained borrowers reduce their personal debt load.” The Congressional Budget Office estimates the legislation would lead to…
One Problem We Can’t Blame on Student Loans
Increased student loan borrowing limits did not raise the price of higher education A new report by the General Accounting Office (GAO) demonstrates that increased student loan borrowing limits did not raise the price of higher education in academic year 2007-08. A number of factors cause colleges to raise already high prices. School officials cite the increasing costs of providing instruction (including professor’s salaries and benefits), maintaining facilities, and operating costs. Officials at public institutions report state…
