Income-Based Repayment
Income-based repayment has its own problems…..
I was depressed to read this account — though not necesssarily surprised.
I have looked on income-based repayment as a partial savior for the student loan mess. The program as advertised has two very desirable features:
— monthly payments are capped at a percentage of discretionary income;
— the debt is forgiven after 15 or 20 years.
However, according to three responsible reform groups, the first borrowers to reach 20 years on this program are often not getting forgiveness. The usual culprits of picayune rules, multiple confusing programs, and sloppy recordkeepinghave tormented the early participants.
The solutions proposed here are not complicated:
– include all loan programs
– do not rely on loan servicers to process forgiveness
– initiate forgiveness from the Department of Education itself