Obama: Student loan plan aids state
BY JIM MYERS World Washington Bureau
Thursday, October 27, 2011
10/27/11 at 7:18 AM
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WASHINGTON - President Barack Obama's plan on college loans would allow more than 23,000 current students in Oklahoma to lower their monthly payments, the White House said Wednesday.
According to a fact sheet, 52,000 borrowers would be able to reduce interest rates and simplify payments by consolidating their loans.
"Last year, graduates who took out loans left college owing an average of $24,000,'' Obama said in a speech in Denver as he continued to promote his plan.
"Student loan debt has now surpassed credit card debt for the first time ever.''
While putting a college education within the reach of every American has never been more important, the president said, it also has never been so expensive.
Next year, under Obama's "Pay As You Earn'' plan, about 1.6 million students will be able to cap their loan payments at 10 percent, and the plan will forgive the balance of their debt after 20 years of payments.
In January, millions of students and recent college graduates will be able to consolidate their loans and reduce their interest rates.
Starting in 2014, borrowers will be able to reduce their monthly student loan payments to 10 percent of their discretionary income.
Under current law, borrowers can limit student loan payments to 15 percent of their discretionary income.
That law also forgives all remaining debt after 25 years, but, according to the administration, few students know about this option.
Obama's announcement is part of a series of executive actions he has taken that the administration says will help put Americans back to work and strengthen the economy.
In addition to promoting his own plan, the president also used his speech in Denver to pressure Congress, especially Republican lawmakers, to do more.
"It's time for all of us in Washington to do our job,'' he said.
"It's time for them to do their job.''
Key Republicans expressed disappointment over Obama's decision not to seek a bipartisan approach on the student loan issue.
"While I agree that the rising cost of higher education is a problem that must be urgently addressed, the president has made no effort to work with Congress to find any bipartisan solutions on the student loan debt issue," said Sen. Mike Enzi, R-Wyo., ranking member on the Senate Health, Education, Labor and Pensions Committee.
"Because this latest plan was literally drafted behind closed doors, we are left with more questions than answers. The president should stop campaigning and start working with Congress to get the results that the American people expect.''
Jim Myers 202-484-1424