Obama Makes College More Affordable- Good News for our MBA Mentees!
Posted on Wed, Jul 01, 2009 @ 07:02 PM
I was happy to come across an article in the New York Times yesterday about new loan programs pushed through by the Obama administration. (read the NYT article here)
Starting today, the federal government begins offering a loan repayment plan that lets graduates reduce their loan payments based on their income.
Additionally, the interest rate on new Stafford Loans will drop from 6% to 5.6% and will continue to fall to 3.4% in 2012 based on a schedule created by Congress.
While the interest rate cuts only apply to those taking out new loans, the repayment plan might apply to anyone with Federal higher-education loans.
Those whose income is low enough will have the balance of their loans forgiven after 25 years. Anyone who works in public service (and the definition of public service is broad and includes the government, nonprofits, education, public health, etc) can have their loans forgiven after 10 years.
As someone contemplating more school (graduate degree? MBA? a certificate program?) and working at a non-profit, I'm thrilled at the prospect of cheaper loans. Hopefully this will help some of the FWL women out there who are joining our MBA mentorship program or are paying off college loans.
For more information on the new income-based repayment, check out the Dept of Educations new website here.