As part of the settlement were included in the health care legislation relating to the federal student loan programs adopted significant changes. Included in these laws is what appears to be less than the Federal takeover of federal student loans, together with the large increase in the Pell grants.
The new law excludes credit program of education of the Federal Council and pieces from the private creditors. Beginning July 1, will be through the federal direct loan program are all federal loans. According to the non-Partisan Congress of the budget of the authority will save the cutting of banks and private lenders commercial loan student taxpayers 61 billion dollars in the next 10 years, at least 10 billion dollars, which will reduce the Federal deficit and to help underwrite the costs of the health reform.
The new law also contains 36 billions of dollars on Pell grants, which provide subsidies to low-income and poor students. The maximum amount of aid, this year will increase Pell $ 5,300 and almost 6 000 $ in 2017. No new law grants Pell would be limited to $ 2,150 next year. Students will receive greater Pell grants will have to borrow less pay College.
From 2014 onwards, borrowers also gets better the maturity of the debt. Current borrowers, you can restrict the federal student loan repayments to 15 percent of their income defined. In 2014, this CAP reduced to 10% of income defined.
The only role for the private sector will be the loan servicing and it seems that the legislative intention to ensure that such contracts will be based on performance and the takeover of the company to provide the best loan servicing customer service.
It seems ironic that this last-minute addition to the legal reform of health is the Federal takeover of actually. It's hard to take seriously the argument that a new health care, the right amount of health care, the new law is to put the Federal Government directly to students for the lending of our nation.
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