Desperate to save their businesses, the private companies who sell loans to college students have been heavily lobbying the government to keep subsidizing their loan programs. A bill that will overhaul the private loan industry recently passed in Congress with clear support from President Obama, who stated in his recent State of the Union Address “no one should go broke because they chose to go to college.”
The new proposal would retract government subsidies to private lending companies and cap the amount students have to pay back every month to 10% of their salary if they make more than $16,245 a year, reports Bryan Gerhart in his article for the California News Service. Loans that hadn’t been paid back after 10 years would even be forgiven if that student worked for a nonprofit or government organization.
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