“Education cost money, but then so does ignorance.” Claus Moser
When we reflect on these words by Claus Moser we can only shake our head in agreement to it.
Both Education and Ignorance will indeed cost you plenty but in terms of what exactly is this going to cost us? There are no loans offered for ignorance so whatever it decides to take away from us, we charge to experience. But as many of you may have noticed education nowadays sure comes with a very hefty price tag.
Getting a good degree will give us an edge in life, which is true so we try to invest in it as much as we can. We know that it would help us get better opportunities and better earning power once we finish studying. That is why most people take out different loans just so they can reach this goal. But the rising cost of college nowadays has somehow made it quite difficult to make this dream a reality. Recent reports released that more and more people are now finding themselves living in greater debt because of student loans acquired and they have difficulty in actually paying. Cost of college increases at twice the rate of inflation.
In comes the Student Loan Forgiveness Act of 2012 (H.R. 4170) According to this bill it aims to increase purchasing power, strengthen economic recovery, and restore fairness in financing higher education in the United States through student loan forgiveness, caps on interest rates on Federal student loans, and refinancing opportunities for private borrowers, and for other purposes.
The Student loan debt forgiveness program is backed by the Federal government. If you decide to participate in one of their programs they would erase portions of your debt. Student loan forgiveness programs are issued through Federal programs like Perkins Loans and Stafford.
Loan debt relief enabled graduate students to be the beneficiaries of President Obama’s student loan debt relief plan. The first part of which is a loan repayment program based on one’s income. The goal is to help struggling graduates make debt payments easier. Students now have to pay 10 percent of their loan and the debt will be forgiven after 20 years.
The second part of the Student loan forgiveness act is the loan consolidation which encourages graduates with multiple federal loans to consolidate it by lowering the interest down to 0.5 percent. This helps paying the loan easier and saves you hundreds of dollars.
Loan debt collection can be enforced in many ways. The Department of Education can collect the money by subtracting it to your tax refunds or they can get it back from Social Security payments. Another thing that they could do is to require your employers to withhold wages from those who opted to default from their student loans. Loans are also released to third parties every year by the Department of Education. These loan debt collection agencies can keep 25 cents to every dollar being collected.
For further reading on student loans and consolidating loans click HERE.