The Trump Administration has issued a proposal to reform the Higher Education Act. School loan debt is finally being addressed by President Trump. His new plan may prove helpful for students, and their parents, currently burdened by repayment across the United States.
Trump’s new plan includes a revision of the current Student Loan Forgiveness structure which allows individuals working in social service to receive forgiveness for remaining balances after 10 years.
Student loan default rates are as high as 30 percent and are expected to climb to close to 40 percent by 2023. The proposal intends to “increase access to affordable, flexible, and innovative postsecondary education and skills attainment to meet the interests and lifelong learning needs of every American.”
Equality, flexibility, and affordability when it comes to college education are the top priorities for the Trump Administration’s new 10-part plan to reform higher education.
The Higher Education Act proposed by Trump’s Administration’s 2020 budget makes significant changes to the landscape of student loan borrowing taking place today. Including a cap on what students are allowed to borrow throughout their lifetime and only one way and amount set for repayment after graduation — 12.5 percent of expendable income. The Public Service Loan Forgiveness plan would no longer be in effect.
Instead, the act includes a policy to provide loan forgiveness for all borrowers after 180 months in active repayment. To try to reduce the number of students graduating with bogus degrees that fail to advance a college graduate into a career or jobs anticipated to vanish, Trump’s plan pushes for businesses and educational institutions to work together.
In addition to the Trump Administration’s new plan, encourages colleges and companies to gear education towards job placement over non-traditional degree programs that fail to satisfy the needs of growing business demands.
After graduation, repayment plans will be a one-size fits all with income repayment plans ending at 180 months post graduation.