Proposed Student Loan Changes
Undergraduate Stafford Loans are offered to most students. The credit history does not play any role in the final decision making. Two forms of the loan are offered. Subsidized loan, in which the government pays the interest rate while the student is still in school, and unsubsidized loans, in which the participant is responsible for those payments. Subsidized loans for graduate students will not be available beginning July 1, 2012. The origination fee rebate has been eliminated and will have to be paid in full by the borrower.
Income Based Repayment Program is currently being revised and may take place as quickly as the end of 2012. The percentage rate is proposed to be modified to 10 percents instead of 15 percent of the participant’s income. Any remaining balance after 20 years will be forgiven.
Special interest rate reduction program is being temporarily offered. It is called Special Direct Consolidation Loans and it does not involve the changes in the terms of your original loan.