Results tagged “pell grants” from EdLabor Journal

An op-ed by Gail Collins in today's New York Times discusses the need to reform student loans. After looking at the private loan sector, she then turns to the federally-guaranteed loans:

This is a system that goes something like this:

• We the taxpayers pay the banks to make loans to students.
• We the taxpayers then guarantee the loans so the banks won’t lose money if the students don’t pay.
• We the taxpayers then buy back the loans from the banks so they can make more loans to students, for which we will then pay them more rewards.

Are you with me so far? Wait, I see a hand waving back there. What’s that, sir? You want to know why the government doesn’t just lend the money out itself? Excellent question!

The White House estimates that it could save about $94 billion over 10 years if it cut out all the middlemen. And it has the basis of a system in place, since the Department of Education already makes a lot of direct loans to students.

We encourage you to learn more about the President's proposal, read the entire editorial and review the highlights from our recent hearing on this subject.

In today's Chicago Sun-Times, Terry Savage's Savage Truth column brings great news for recent college graduates.

Starting July 1, there will be new help for recent grads -- or those who have been out of school for a while and are struggling to repay student loans. The new federal Income-Based Repayment program will allow those with low incomes to pay as little as zero on their student loans, as long as they qualify based on income and amount of debt.

The rules are a little complicated, but you can visit www.IBRinfo.org. to use their online calculator to see if you are eligible.

Additional benefits that start on July 1 from the College Cost Reduction and Access Act include:

• increase in Pell Grants
• reduction in interest rates on federal loans from 6.0% to 5.6%
• TEACH grants for qualified undergraduate students who commit to teaching in public schools in high-poverty communities or high-need subject areas.
• Loan forgiveness after 10 years for public servants

We encourage you to read Ms. Savage's entire column and visiting our page on the College Cost Reduction and Access Act for more information.

In today's paper, the New York Times has an article about the difficulty of paying for college. It follows Brennan Jackson, an A-student who ranks near the top of his high school class, as he tries to raise the $25,000 he still needs for his freshman year at the University of California, Berkeley, by stitching together a quilt of merit scholarships.

While Brennan’s situation, and the remedy he is pursuing, may sound extremely ambitious, guidance counselors across the country say they can recall no prior year in which so many applicants’ families have been squeezed by so many financial pressures.

Not only have families’ incomes been falling as their savings have dwindled, but also tuition has been rising — including proposed increases of nearly 10 percent next year throughout the University of California system....

Interest rates on student loans, including on popular federal programs like the unsubsidized Stafford (now nearly 7 percent) and Parent Plus (8.5 percent), are running several percentage points higher than the rates on secured loans, like home equity lines of credit.

“The difference of rates between secured and unsecured loans is higher than I have ever seen,” said Scott White, director of counseling services at Westfield High School in New Jersey. “This is one further impediment to access to post-secondary education for all but the well-to-do.”

President Obama has put forth a solid plan to make federal student loans more reliable, while saving taxpayers billions of dollars. To learn about the President's proposal, click here.