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September 5, 2017

Dept of ED Throws Consumers Under the Bus

The Department of Education barely bothers to pretend it has the best interests of student loan borrowers in mind anymore. In announcing its intent to cut the Consumer Financial Protection Bureau out of federal student loan servicing oversight, ED admits that it is declawing the CFPB because the CFPB had the nerve to actually handle borrower complaints. How dare it? In a half-hearted attempt to spin its obviously anti-consumer announcement, ED asserts that the CFPB's efforts on behalf of borrowers add "confusion".…

November 30, 2016

Cost estimates for Income-Driven Repayment plans are unreliable

For the fiscal year 2017 budget, the Department of Education (ED) estimated that Income-Driven Repayment (IDR) plans will cost $74 billion. Actual costs will depend on how many borrowers participate in IDR plans and how much (or how little) those borrowers earn over time. After reviewing how ED produces its cost estimates, the Government Accountability Office (GAO) criticized aspects of ED’s methodology and concluded that ED’s cost estimates are not reliable.  GAO found that ED’s methods may both over- and under-state actual…

June 4, 2016

Direct Loan interest rates to be half percent lower for 2016-17

Not exactly thrill worthy but better a tiny bit lower than any higher, am I right? Federal Direct Student Loans 2016-2017 Interest Rates (For Loans First Disbursed on or After July 1, 2016 and Prior to July 1, 2017) Loan Type Borrower Type Index/10-Year Treasury Note Add-On Fixed Intrest Rate Direct Subsidized Loans Undergraduate Students 1.710% 2.05% 3.76% Direct Unsubsidized Loans Undergraduate Students 1.710% 2.05% 3.76% Direct Unsubsidized Loans Graduate/Professional Students 1.710% 3.60% 5.31% Direct PLUS Loans Parents of Dependent Undergraduate…

November 30, 2015

How Student Debt Impacts Homeownership

Many thanks to Satinder Haer of Zillow for contributing this post!  -Heather Buying a house is the biggest milestone after graduating college for many people. But if you’re facing a mortgage-sized student loan payment each month, homeownership may feel impossible. One common belief is that student loan debt prevents many from saving for a down payment. However, new numbers show student loan debt might not be a major hindrance to homeownership. As long as you obtain a four-year degree or higher, student debt has a minor impact on your…

By Heather  |  Category:  Personal Finance, Student Debt  

March 9, 2015

Who Will Benefit from the Expansion of Pay As You Earn (PAYE)?

Negotiated rulemaking, affectionately referred to as Neg Reg, is underway!  Committee members met to discuss a proposed agenda, and the Department of Education will release the committee’s final agenda before they reconvene on March 31st. Over three months the negotiators will discuss, among other things, how to implement the President’s directive to expand Pay As You Earn to five million additional borrowers by the end of this calendar year. The Department of Education has proposed creating a new plan, PAYE2, for Direct Loan borrowers…

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