Siouxland reaction to President's student loan debt plan
"Dream big." It's something many of us are told to do when we're young, long before we choose a career.
Many careers require a college diploma, but earning that degree comes at a hefty cost.
"The good news is more young people are earning college degrees than ever before. That's something we should proud of and something we should celebrate. But, more of them are graduating with debt," President Barack Obama said.
Briar Cliff University Junior Justine Townsend said she's borrowed $30,000 to $40,000 in student loans over her first two years at school.
"I'm not going to stress about it really," Townsend said.
"The majority of students who attend Briar Cliff will borrow some form of loan before they graduate," Briar Cliff University Financial Aid Director Brian Eben said.
But, the reality of loans set in once students walk down the aisle at graduation.
"Americans now owe more on student loans than they do on credit cards. And the outrage here is that they're just doing what they've been told they're supposed to do," President Obama said.
That's why the president signed an executive action that includes several ways to address the issue of student loans.
The first part of the plan is to allow 5-million more graduates to qualify for an income-based repayment plan.
This plan caps student loan payments, for federal direct student loan borrowers, at 10-percent of a person's income per paycheck.
"They're trying to make it more manageable for graduates to pay back as much as their student loans as possible without going into default," Eben said.
The second action Obama defined is to renegotiate contracts with private companies like Sallie Mae and Wells Fargo.
Townsend said BCU's financial aid department has been a big help when it comes to getting student loans.
"A lot of the financial aid people understand my situation because Briar Cliff is very personable with all the staff and the students, so they do understand, and it's not so business-like," Townsend said.
"We want to make sure you fully understand what it is that you're going to be responsible for paying back when you're done," Eben said.
The third action in the president's plan is to get more associations and groups involved in educating students about their borrowing options before they get saddled with thousands of dollars in debt, something BCU said is very important.
"That gets back to the transparency of us, that we are informing all students as early as freshman year, so they know what they are getting into," Eben said.
Townsend said President Obama's plan could definitely pay off in the long run.
President Obama added how Congress needs to take action as well. Congress is set to vote on the presidential memorandum, this week.
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