Honolulu Star-Advertiser

Friday, December 13, 2024 77° Today's Paper


Top News

Budget seeks end to subsidized student loans, forgiveness

WASHINGTON >> The Trump administration is proposing to eliminate subsidized student loans and end student debt forgiveness for those who enter public service, according to a budget document released late today.

The proposals are likely to face criticism amid calls to make college more affordable and as millions are struggling to pay off student loans.

In a budget document made public tonight, the administration seeks to save just over $1 billion by doing away with the subsidized student loan program. For undergraduate students who qualify, the government pays the interest while they remain in college. Students can borrow up to $23,000 during their four years in college. The current interest rate is 3.76 percent.

The document also calls for eliminating the Public Service Loan Forgiveness program with the aim of saving $859 million. That program was launched in 2007 with the idea to motivate university graduates to take government and teaching jobs in remote rural areas. Under the program, the remainder of a student’s debt is forgiven after he or she makes 120 qualifying payments, or typically after 10 years.

Student Debt Crisis, an advocacy group, says on its web site that over 550,000 people are on track to receive the benefit with the first wave of forgiveness set for October. The document did not provide any details on how that group might be affected.

By participating in online discussions you acknowledge that you have agreed to the Terms of Service. An insightful discussion of ideas and viewpoints is encouraged, but comments must be civil and in good taste, with no personal attacks. If your comments are inappropriate, you may be banned from posting. Report comments if you believe they do not follow our guidelines. Having trouble with comments? Learn more here.