Boston Student Loan Lawyer

Law Office of Adam S. Minsky

  • Home
  • Services
  • About
  • Publications & Press
  • Testimonials
  • Speaking & Trainings
  • Contact
  • Blog

BREAKING: Pres. Obama To Expand “Pay-As-You-Earn” Program

June 8, 2014 | Adam S. Minsky, Esq. Loan Forgiveness Pay-As-You-Earn Policy & Reform

Share the post "BREAKING: Pres. Obama To Expand “Pay-As-You-Earn” Program"

  • Facebook
  • Twitter

In a move that could benefit millions of federal student loan borrowers, President Obama will be issuing an executive order to reduce monthly payments under current income-driven repayment programs.

In 2007, Congress and President Bush passed a law that created the Income-Based Repayment (IBR) program, which allows federal student loan borrowers to make payments on their federal student loans based on their income. The program caps monthly payments at 15% of a borrower’s discretionary income. After 25 years of payments under the IBR program, whatever balance remains is forgiven.

Last year, President Obama created the Pay-As-You-Earn (PAYE) repayment program. This program improves upon IBR by capping payments at 10% of a borrower’s discretionary income. Furthermore, a borrower’s remaining loan balance is forgiven after only 20 years, instead of 25 years. PAYE is a significant improvement over IBR in terms of the repayment and forgiveness terms, but unfortunately, the U.S. Dept. of Education limited the program’s eligibility to what it calls “new borrowers.” These are borrowers who had no outstanding federal student loan debt as of Oct. 1, 2007, and also took out a new federal student loan on or after Oct. 1, 2011.

This week, President Obama announced that through executive order, he will be expanding the PAYE program to an additional 5 million borrowers. I’ve been advocating for an expansion of this program for years. This will have real, measurable impacts for people by significantly reducing their monthly payments and shortening their repayment term. It is unclear, however, who these 5 million borrowers will be, since there are approximately 30 million borrowers in the Direct Loan program.

Will you be eligible for the expanded PAYE program? Who is going to be left out of this executive action? Stay tuned, I’ll be posting new information about this as it becomes available.

Share the post "BREAKING: Pres. Obama To Expand “Pay-As-You-Earn” Program"

  • Facebook
  • Twitter

Loan Forgiveness Pay-As-You-Earn Policy & Reform

About Adam S. Minsky, Esq.

Adam S. Minsky founded the first law office in Massachusetts devoted entirely to assisting student loan borrowers, and he is one of the only attorneys in the country practicing in this area of law. He provides counsel, legal assistance, and direct advocacy for borrowers on a variety of student loan-related matters. He regularly speaks to students, graduates, and advocates about the latest developments in higher education financing.

Books by Adam S. Minsky

The Student Loan Handbook for Law Students and Attorneys

The Student Loan Handbook for Law Students and Attorneys

Student Loan Debt 101

Student Loan Debt 101: The Definitive Guide to Understanding and Managing Your Student Loans

Student Loans for Parents and Cosigners

The Student Loan Guide for Parents and Cosigners

617-936-2788
asminsky@minsky-law.com
By Appointment Only 265 Franklin Street, Suite 1702
Boston, MA 02110

Copyright © 2023 Adam S. Minsky · DISCLAIMER: This website may be considered advertising under Massachusetts Supreme Judicial Court Rules. The content of this website is for informational purposes and should not be considered legal advice. This web page does not establish an attorney-client relationship. Terms of Use

Copyright © 2023 · MinskyLaw on Genesis Framework · WordPress · Log in