Changes to Student Loan Repayment Programs Not Enough, Advocates Say
Despite 1,500 individuals and a dozen national organizations pushing
for further changes to legislative provisions that help low-income
college students repay their student loans, the Education Department
recently issued the provisions’ final regulations without first
making modifications to problematic language (“Low-Income Student
Borrowers May Miss Some Intended Benefits,” The Chronicle of Higher Education, Oct. 26, 2008).
One issue involves the rules of a new student loan forgiveness
program that would allow college graduates to have their federal
loans forgiven in return for at least 10 years of public service in
specific professions. Advocates of the program say that language in
the program’s regulations fail to establish procedures that would
inform college graduates ahead of time about which specific
positions qualify for loan forgiveness.
Robert Shireman, executive director of The Project on Student Debt,
a California-based advocacy group, believes that there may still be
a way for the Department of Education to resolve this issue without
having to backtrack through the regulatory process.
Education Department spokeswoman Samara Yudof, on the other hand,
says that regulations for the loan forgiveness program “are clear,
and provide a broad list of eligible occupations.” Department
officials prefer to identify the eligible occupations in paperwork
they give to applicants, instead of detailing the occupations within
the regulations themselves, she says.
The other major regulatory issue creates a “double-counting penalty”
for married couples under a new income-based repayment plan for
student loans. If both partners are eligible for income-based
repayment and they file joint income tax returns, supporters of the
program say, the regulation’s language could be interpreted in such
a way that the couple’s total joint income would be used to
determine how much each spouse pays individually. This “double-
counting” effect may require them to pay twice as much as two
unmarried borrowers in similar financial circumstances.
“This is obviously unfair and inappropriate,” Shireman said, “and
needs to be changed by Congress.” Yudof concedes that, in this case,
Congress may need to take action to resolve the “double-counting”
penalty problem.
Comment Notification
If you would like to receive an email when updates are made to this post, please register here
Subscribe to this post's comments using