student loans

CFPB achieves two major wins for student borrowers

Guidance on affordable private student loans

Many student borrowers struggle to repay their loans for a variety of reasons: the jobs they take after graduation don’t pay enough to cover monthly loan payments, sudden illnesses or emergencies put a strain on their finances, or their loans were set up to fail with predatory terms and exorbitant costs.

College Savings Plans Should be Expanded, Not Taxed

College prices are rising, pushing potential parental contributions to the extreme and requiring students to take on more student debt. To address this, millions of parents have been putting money away for their children’s education in 529 college savings plans. These plans allow parents to put money into an account that grows tax-free. Money withdrawn from these accounts for qualified educational purposes is also not subject to taxes. The 529 college savings works by encouraging parents to save so their children can attend college without taking on excessive student debt.

State of the Union elevates “middle-class economics” issues, but low-wage workers need a boost

President Obama proposed a plan for community college students, called America’s College Promise, which would make two years of community college free for qualified students. President Obama noted that 40 percent of college students choose community college: “Some are older and looking for a better job. Some are veterans and single parents trying to transition back into the job market. Whoever you are, this plan is your chance to graduate ready for the new economy, without a load of debt.

Obama’s new college plan can make college affordable, should target low-income students

The Tennessee Plan, which pays for community college tuition not covered by federal grants for qualified students in Tennessee, inspired the America’s College Promise plan. President Obama’s proposal differs from the Tennessee plan by covering the full tuition cost for all students, even those who receive federal grants such as Pell grants. Under the proposal, the federal government would cover seventy-five percent of the community college’s tuition and the participating state would absorb the difference.

ED For-Proft Rules Eye Student Loan Balances to Determine Aid Eligibility (Morning Sun)

"Career colleges must be a stepping stone to the middle class," U.S. Secretary of Education Arne Duncan said. "But too many hard-working students find themselves buried in debt with little to show for it. That is simply unacceptable. These regulations are a necessary step to ensure that colleges accepting federal funds protect students, cut costs and improve outcomes. We will continue to take action as needed."

To qualify, most for-profit and certificate programs must prepare students for “gainful employment in a recognized occupation.”

Student-Loan Market Recalls Subprime Crisis for U.S. Treasury (Rocket News)

Deputy Secretary Sarah Bloom Raskin today voiced concern that education-loan borrowers could turn to repayment scams resembling mortgage-payment schemes from 2009 and 2010. Her remarks come a day after a Treasury committee report drew parallels between student-loan default risks and the mortgage market before housing collapsed starting in 2006.

Student-Loan Market Recalls Subprime Crisis for U.S. Treasury (Anicazna)

Deputy Secretary Sarah Bloom Raskin today voiced concern that education-loan borrowers could turn to repayment scams resembling mortgage-payment schemes from 2009 and 2010. Her remarks come a day after a Treasury committee report drew parallels between student-loan default risks and the mortgage market before housing collapsed starting in 2006.

Student-Loan Market Recalls Subprime Crisis for U.S. Treasury (Bloomberg News)

Deputy Secretary Sarah Bloom Raskin today voiced concern that education-loan borrowers could turn to repayment scams resembling mortgage-payment schemes from 2009 and 2010. Her remarks come a day after a Treasury committee report drew parallels between student-loan default risks and the mortgage market before housing collapsed starting in 2006.

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