Election day is just around the corner !  Or maybe you are taking advantage of the opportunity to vote early? Both candidates have opposing views on many subjects and the student loan crisis is no different.  They don’t agree here either.

How does each candidate feel about the one trillion dollar student loan debt, and the tuition costs that have exceeded the rate of inflation?  Here are some notes from recent articles written on this subject.

Obama

Ended the Federal Family Education Loan program, and made it so that all federal student loans are handled through the Department of Education

Has expanded the Pell Grant program

Has eliminated subsidized Stafford loans for graduate students,

Has eliminated some aid for students without a high school diploma

Created repayment program that caps payments at 10% of income

Created the Public Service Loan Forgiveness program

Wants to take federal aid away from for-profit colleges and universities if more that 65% of  their graduates default on student loan. In other words, regulate for profit colleges.

Romney

Less focus on student aid programs, wants to boost the job market for recent graduates.

Wants to  repeal income based repayment plans and the Public Service Loan Forgiveness Program. (Both of these programs were put into place by Obama).

Romney supports private-sector involvement in student loans

Feels that consumers should be allowed to make their own choices about education and the government should not regulate for profit colleges.

Wants to eliminate Pell grants for part time students, tighten restriction on Pell eligibility and keep Pell grants at $5,500.

Desires to reduce tuition inflation but hasn’t stated how he will do this.

Information for this article was gathered from   www.opposingviews.com, www.foxbusiness.com/personal-finance

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Just thought I would share with you a message that I got from one of the students registered on the StudentLoanList.   Student loan debt gets some bad press  sometimes, and I thought you might like to hear from a real person that is struggling because of her debt.

Thank you so much Allyson for responding back so quickly.  I hope this all leads to a very happy ending and a positive experience for me.  It has been very stressful for me the past few years financially.  I am happily married with 3 children, but I am definitely not where I want to be financially at this present time.  I just pray every day for a second chance to be debt free so that I am able to provide for my children without worrying constantly about my enormous debt. No matter what, I just want to thank you in advance for giving honest hard working people like me hope and faith that there are good people out there that want to make a difference in a person’s life for the better. God bless you and a have nice day.  I am looking forward to hearing from you soon.

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If you have any kind of question about Federal Student Aid, then you need to check out the new website  from the U.S. Department of Education. The web addy is  www.studentaid.ed.gov . It has all kinds of information about what kinds of loans are available, how to get them and  it also has infromation about what to do if you find out you can’t make your payments.

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There is a lot of talk about the student loan debt in the United States lately. One of the big questions is whether or not the interest rate for new Stafford loans will remain at 3.4% or increase to 6.8% on July 1 2012. Apparantly both Republicans and Democrats want to leave the interest rate at 3.4%, the big debate is how to make it happen.

My guess is that NO they won’t raise the rate. Politicians don’t want voters disgruntled about this in November.

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This morning there was an article on Yahoo news that you might want to take a look at. It features graphs that shows the total  student loan debt compared to credit card debt and auto loan debt, and default rates on the three categories. You might have guessed already that student loan default is the highest, followed by credit cards and auto loans. According to the numbers presented: Student loan defaults in 2009 were about 9% and auto loans for the same time were just over 2%.

While not everyone will agree that borrowing your way through college is a good idea, the article shows a few statistics for wages, and some jobs will pay you almost enough during your first year of employment to repay your loans. Of course it isn’t practical to pay every cent you make to service your debt, but for high paying jobs the hope is that you will be able to budget in enough to get that debt paid off. The problem currently is that many graduates are not getting high paying jobs and they are unemployed  or under employed and yet still have to pay rent and other living expenses regardless of their low wages.

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The most recent   video added to the StudentLoanList page on  YouTube is of  President Obama at Fort Stewart in Hinesville,Georgia on April 27,2012.  Speaking to members of the military and their families, he expresses his unhappiness with representatives of various schools which have been praying on members of the military.  They get prospective students to  sign up, obtain student loans and then the student  may or may not get an education. He calls this practice “abusive recruiting” and vows to put an end to it. Obama explains the “know before you owe” information sheet which will give prospective students detailed information about  college tuition and other costs of attending a particular school and obtaining student loans.

Click here to go to the StudentLoanList page on YouTube

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How much student loan debt is reasonable ? What happens when students borrow more for college than they can pay back ? Student loan debt has been expected to reach the one trillion dollar mark this Spring, and today was  noted at many activities across the nation as the day that it would happen.

Students protesting the student loan debt problem were at several different colleges today in an effort to draw attention to the dire situation of students leaving college with large debt that will seriously affect their lifestyle. The cost of college tuition has far exceed the rate of inflation, and students cannot work summer jobs to pay for college as their parents did.  College graduates may be in for a rude awakening when they realize that high balances on student loan debt will affect their ability to purchase a  car or a home and other consumer purchases that college graduates assume that they will be able to afford.

As it stands, on July 1 the interest rate on federal student  loans may double. Currently at 3.4 %,  federal student loans that originate after July 1 will have a 6.8% interest rate. President Obama has made Congress aware of his desire that this does not happen, but it is not his decision to make.

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