It is a rare sight to see a student who has not had to take on at least some debt in their college career. As tuition costs (not to mention board, and fees) rise across the board, seven out of ten students will graduate with debt, the average amount of which is over $28,000. Student debt is now the second largest source of debt in the country, trailing only moderately behind home mortgages, and Georgia alone has a staggering $44,263,989,000 in outstanding debt.
A necessary evil of the system, it is nonetheless a stressful experience for students to have to navigate the world of repayment during school or after graduation. Students may have multiple loan servicers, may have become disabled or joined the military, or may have to defer payments until they find work, all of which means clambering through a complicated jungle of federal red tape and third-party banking policies.
New legislation, announced by President Obama last month during a speech at the Georgia Institute of Technology, aims to help students simplify their options for their loans and ensure that they have access to the resources they need to get through college successfully and then pay back their debts after graduation.
President Obama said in a conference call to student journalists that he sees getting a college education as “the surest ticket to the middle class.” He emphasized that without federal assistance, he and his wife would not be where they are today. “Michelle and I have gone through this ourselves, we wouldn’t be here, where we are, if we hadn’t gotten grants and loans and work study…we have to make sure that those tools are there for this generation, without students having to be burdened with huge debt.”
While the legislation does not do any active work to decrease student debt, it will make managing loans much easier.
By 2016, Obama has tasked the Department of Education to build a central website for student loans, where students can go and view all of their outstanding loans side by side. They will also be able to use the website to file complaints, ask for help with income-based payment plans, and to get any other help or other information they need with regard to repayment. The site will also act as a kind of oversight organization for school financial aid offices to ensure that they are providing accurate information and giving quality customer service.
Despite what he called “enthusiastic reception across the board,” Obama emphasized that, as it stands right now, the legislation is really just a memorandum, and will require the approval of Congress before it can be implemented.
In a similar situation is Obama’s earlier proposal to make the first two years of community college free. As Congress deliberates on the budget, the White House is encouraging those who “believe in a Student Aid Bill of Rights” to go to WhiteHouse.gov/CollegeOpportunity and sign their name to the declaration. “If we all rally around these principles, there’s a lot that colleges, lenders, and the people you sent to Washington and to your state legislatures can do to realize them across the country,” Obama said. “We can’t allow college education to become a luxury.”