The mission of the new federal Consumer Financial Protection Bureau is to make financial markets work better for ordinary Americans. Now that total outstanding student loan debt is over one trillion dollars and exceeds total credit card debt, it only makes sense that this agency will put student debt squarely in its sights.
To assist these borrowers, the bureau has now launched an online tool to help grads evaluate their options for repaying their student loans.
The Student Debt Repayment Assistant is a guided workflow that provides useful information based on the type of loan(s) a borrower has, their ability to repay and other factors.
It’s also useful for people not already in repayment as it estimates payments for folks based on current federal guidelines.
Individuals who don’t have detailed information about their lenders and loan amounts can access a link to the National Student Loan Data System (NSLDS) that keeps track of all federally-subsidized student loans.
But Americans who owe money on student loans will also be well-served by following the outcomes of President Obama’s recent proposal to limit the amount of money they will have to pay on student loans when their income is taken into account.
Under the President’s plan, over a million student loan borrowers would be able to cap their loan payments at 10 percent of their discretionary income starting in 2012. This would dramatically reduce payments for many, especially younger borrowers who are the lower end of their career earnings.
Obama plans to affect this change by executive order, bypassing the Republican-led Congress where he’s had little success in pushing policy.
The CFPB’s tool will certainly be updated if that comes to pass, but you can see it in its current form at http://www.consumerfinance.gov/students/repay/.AVR29FE2HGPY