preview

Student Debt Forgiveness

Decent Essays
With student loan debt on the rise and more borrowers struggling to make their monthly payments, many people want President Trump to take the reins and keep some of his campaign promises. In October of 2016, then Republican presidential candidate Donald Trump proposed new student loan guidelines that would cap total repayments at around 12.5 percent of a student loan holder’s income for 15 years from their graduation date. After 15 years, the proposal would forgive the rest of the student loan holder’s debt.

However, experts believe that hardline conservatives in the House and Senate will block any attempt by President Trump and his administration to fully implement any student loan debt forgiveness. Some feel that President Trump’s stance
…show more content…
However, most student loan holders do not qualify for the program, and there is speculation that the Trump administration and the Republican-controlled House and Senate may cap the debt forgiveness or eliminate the program entirely.

Many student loan holders also want the new administration to implement federal programs that allow borrowers to refinance their loans. The only option borrowers have now is debt consolidation through the Department of Education. Borrowers can refinance their student loans through private lenders, but the pitfall is debt holders permanently lose their access to any debt-repayment programs.

Experts believe that any changes to the federal government’s current policies will not occur until sometime in 2018. In the meantime, borrowers are still unsure about how the new administration will impact student loans. According to the Student Loan Hero survey, about 40 percent of student loan debt holders believe the Trump administration will have a negative impact on student loans, while 40 percent believe the administration will have neither a positive or negative effect.

The New Administration and the Future of the
…show more content…
The Trump administration is closely monitoring the roles of independent regulatory agencies since the president signed the executive order to reduce the regulatory burdens created by Dodd-Frank. Since many people consider the CFPB an independent agency, several student loan debt holders are left to wonder if a federal agency will exist to help protect them from predatory lending practices.

The CFPB helps protect student loan borrowers from lenders who charge excessive fees or creating obstacles that prevent people from paying off their debt. In January, the CFPB sued Navient, which is the nation’s largest student loan service provider. The CFPB website states that Navient defrauded or deceived student loan debt holders for years by creating unnecessary obstacles that prevented them from repaying their student loans. Now, many student loan borrowers fear that the CFPB may not exist much longer under the new administration, and they will not have an agency that protects them from predatory lenders or
Get Access