Should College Grads Get a Break on Their Loans?
The Obama administration has eased the terms on student debt. What impact will the new rules have?
The plan will let borrowers consolidate their government loans and government-backed private loans into one monthly payment, at a lower interest rate. It will also give people the right to cap their loan payments at 10 percent of their income, down from a current limit of 15 percent, and will allow student debt to be forgiven after 20 years, compared with 25 years under the law now.
Will the Obama plan make a difference?To collect college debt, predatory creditors garnish wages and deduct from Social Security and disability payments. The Justice Department actually prosecutes the bankrupt -- even though borrowers in default are charged two and three times what they borrowed because of bogus fees and penalties and compounded interest, making the money mathematically impossible to pay.