Back in 2007, Congress passed the College Cost Reduction and Access Act. This bill is designed to encourage students to go to college and work in a public service field. By doing so, they could qualify for student loan forgiveness. All they do is find work within the government or nonprofit institutions after they graduate.
The problem is, the rules of this program were misunderstood. It wasn’t well-publicized. Because of that, those who believe they qualified for student loan forgiveness are getting the runaround. We covered many stories here at Financial Helpers of students who paid into their program for 10 years.
The Public Student Loan Forgiveness part of the bill allowed federal loans to be forgiven after 120 qualifying payments. It takes about 10 years to make 120 payments. If you have a lot of student loan debt, the benefits to you under this program are innumerable. That’s usually doctors and dentists who’ve been going to school for nearly a decade.
To learn more about student loan forgiveness, call Financial Helpers today. We’d love to hear from you and answer any questions you might have. You can reach us at:
News and Benefits of Student Loan Forgiveness
The tuition for a college education is continuing to skyrocket. The 2018 survey of medical students revealed that nearly half of them (45.7%) expect to enter the student loan forgiveness program. In 2010, that number hovered around 11%. While this is a great thing for public service workers all over the country, negative news has hampered expectations.
President Obama’s intention to help students struggling with debt melted away once President Trump was elected. His first budget in 2016 proposed getting rid of student loan forgiveness programs. Luckily, he negotiated the budget which kept the programs intact. Still, Education Secretary Betsy DeVos seems to side with for-profit colleges and not students.
In recent news, it was reported that only one percent of students who applied for student loan forgiveness had actually received it. This caused a major uproar among Democratic-held states. All this negative news are forcing students to remain pessimistic about receiving help during this crisis. Many are drowning in debt. Finding help within this administration seems futile. Still, the hope is there. All you can do is hope things change.
Don’t Give Up!
While the numbers for student loan forgiveness don’t look good, there are various reasons for that. The first is that the borrowers did not read the rules or follow them correctly. According to the same report, 40% of all processed applications did not meet qualifications. Therefore, this is why it’s essential to plan for this contingency before taking out a loan.
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A lot of other cases involved in competency on part of the student. Many applications have errors. Others filed for student loan forgiveness but didn’t even have qualifying loans. This all has to do with the lack of understanding about what the bill says. So, if you follow the directions, you will qualify for forgiveness.
Before you go to college and apply for a loan, know every option you have. So, prepare for college 100%. Don’t just go in thinking you’ll figure it out as you go or else you get blindsided. 44 million students hold $1.53 trillion worth of student loan debt. A lot of it has blindsided students after they graduated with immediate payments.
By being prepared, you won’t have to be scared. Regardless of the economy or whether student loan forgiveness has been canceled, you’ll have a plan. Never give up hope. And, whatever you do, don’t let your lenders give you the runaround. Many students have been defrauded by their lenders. They tell them something that isn’t true to get them to not qualify. It’s a shady practice, but students have fewer protections. So, be vigilant.
