Student Loan Forgiveness Program

1
How Obamas idea gave boost to the Direct Loan
Program with Forgiveness Schemes
2
The student loan forgiveness program has earned
popular nickname from the borrowers. Owing to
President Barrack Obamas stupendous efforts in
making higher education easy and affordable, the
Direct Loan program is now called as Obama
Student Debt Forgiveness program. It is worth
mentioning that the Direct Loan program actually
derives its origin from William D Ford, who
transformed the scene of American education.
3
The direct loan program was restructured in the
year 2009 to accommodate new ideas and loan
benefits. The Obama Student Debt Forgiveness was
first included in the Health Care and Education
Reconciliation Act of 2010 which covers all
federal student loans. The private loan borrowers
remain eluded from enjoying the benefits of the
student loan forgiveness program.
4
Features of Revised Direct Loan program

•  The student loan forgiveness program that is
  available today boasts of incredible features
  considering the highly fluid set-up of the
  education system in USA.
• Student loans will not attract any more subsidies
  from the federal agencies.
• 2. The private lending institutions offering
  federally-backed loans wont be able to ask for
  any subsidies from the federal government.
• 3. The forgiveness program began from 2014. The
  borrowers who new loans form the 2014 portfolio
  can make repayments based on the restructured
  student loan forgiveness program.

5

• 4. The repayments will be equated to the
  discretionary income set at 10 percent.
• 5.New borrowers will enjoy shorter eligibility
  term. The student loan forgiveness is now reduced
  after 20 years of repayment on the qualifying
  loan payments instead of the earlier term of
  25-years.
• 6.The repayment amount is now directed to fund
  poor communities who dont have access to
  education. It has definitely been designed to
  raise the volume of college funding without
  putting pressure on state funds.

6
Modes of making payment in a Direct Loan
Program
Borrowers can now enjoy a more defined and
affordable modes of loan repayment. The borrowers
can derive benefits from the student loan
forgiveness program with the option of
consolidation of all federal student loans into
on single loan. The student loan forgiveness
program offers fourdiversified loan repayment
plans.
7
-Standard Repayment Choose the standard option
to pay a fix sum every month till the loan term
stands. The amount to be paid every month is
deduced from the loan sum and interest rate.
-Graduated Repayment This mode of repayment
is a progressive structure that allows the
borrower to make higher payments with time. The
repayment sum beings with a small amount usually
lower than the standard repayment value. The
amount remains constant for the first few years
before gradually increasing thereon every two
years.
8
-Income Contingent(ICR) The borrower can enjoy
repayment with income-linked mode called as ICR.
The value of loan repayment is also based on the
family size and number of dependent members.
Borrowers can begin with zero. -Pay-As-You-Earn
PAYE offers the borrower the lowest monthly loan
repayment based on the income. Instead of the 15
per cent IBR rate, PAYE is equated as 10 per cent
of the discretionary income.
The forgiveness amount can save millions of
dollars in the first few years for students with
a normalized, affordable interest rate.
9
Contact Us
Student Debt Center Cesar Buitrago Address -
18459 Pines Boulevard, Suite 532, Pembroke Pines,
FL 33029 Contact No. - 800-551-7187 Email Id -
info_at_studentdebtcenter.org Website -
http//studentdebtcenter.org/