There has been discussion about potential college student loan changes by the Biden administration — and possibly loan forgiveness.
At the non-profit Iowa Student Loan, president Steve McCullough, says you shouldn’t wait to see what the federal changes are before reviewing your loans.
“The most important thing those people can do now rather just wait for some additional assistance, is to call their loan servicers and inquire about what tools are already in place that can help them,” McCullough says. He says it is an important issue that does need attention.
“There are some student borrowers who are in desperate need of assistance. It’s not every student loan borrower — as a matter of fact it is only a minority percentage of borrowers who are really in crisis — but for those borrowers, they really need some help,” McCullough says. “So it is good that policy makers are looking to provide additional help for student loan borrowers.”
College students used to have ten years after they graduated to pay off their student loans. McCullough says that has changed.
“Over time what happens, is borrowers have been given a lot more repayment options and extra time to repay,” according to McCullough. “There is a program right now called income contingent repayment, or income-based repayment, where people will pay as a percentage of their income. And if that loan is not repaid after 20 years, that remainder is forgiven.”
McCullough says everyone is different and you should review your own situation and see what is best.
He says is you are struggling to make payments you should look at the income contingent payment program as it can lower your payment amount and if you don’t get a better job, the amount will eventually be forgiven. McCullough says you can also call Iowa Student Loan and they can help you find the information to consider what to do with your student loans.