http://www2.ed.gov/about/overview/budget/budget15/justifications/s-loansoverview.pdf#page=12&zoom=auto,69,482

Hello All,

I’d like to have a discussion about the recent proposed changes. So basically, the idea is to allow all come under PAYE. Great for some people—its a 10% income payment instead of 15%.

Except, now they want to change the rules for calculating your income for married borrowers. Under the new PAYE, married borrowers MUST include their spouses income in making their payments. That is gonna encourage a lot of on-paper divorces. Lets say, for example, if I make 82k, my spouse makes 32k—and my spouse is the only one with loans—we’re talking getting hit with upwards of $600 dollars a month for 20 years! That spouse who was paying a $250 payment for their 32k income now is treated like someone making six figures! That is worth an on-paper divorce, in my option, no doubt about it. So in my situation, we both have loans—and IBR was generous because it allowed one spouse to not burden the other. Hopefully that stays, and hopefully you always have that option. But it really is not fair to see the government target these repayment programs because we’ve been planning our finances/marriage around these laws.

And there is the cap on loan forgiveness at 57k and extension of payment years from 20 to 25. Wow. Luckily it looks like it is only for NEW borrows but I expected better from Obama—I thought the idea was to give the middle class a break?

“And there is the cap on loan forgiveness at 57k and extension of payment years from 20 to 25. Wow. Luckily it looks like it is only for NEW borrows but I expected better from Obama—I thought the idea was to give the middle class a break?”

I believe that the proposal for the $57,500 cap only applies for the public service loan forgiveness. Where did you see that it would only apply to NEW borrowers?

I am also trying to figure out if the cap only applies to new borrowers - it is not clear to me from the budget narrative.

you guy do understand this is just a proposal and most of this stuff will not come true. Atleast not this year/ next year

edit: and the 57k cap is good for the govt. they know doctors are going to dump 400-600k debts on them after working for a VA hospital or something like that. Some of them are even making payements of 0 while in medical school. The goverment doesn’t want to be screwed ( even though they continue to screw everyone else ha)

I fully understand that it is just a proposal, but I want to make sure I understand exactly what the proposal is. And I’m not really here to argue whether it’s a good or bad thing (and would probably agree it’s a good thing overall if it only applied to new borrowers, which does seem likely). I’m just trying to understand how it applies to me given that I have very high student loans and have made several career and financial decisions believing I would qualify for full forgiveness in 7 years (I’m 3 years in). We all know congress doesn’t exactly function so who knows what the prospects are of these things making it any further, but I want to be educated on it before deciding whether I agree with it and/or if I want to talk to my representatives about it.