House passes increased college aid for students in need; ends reliance on private lenders

[sabra]

Source: Chicago Trib/AP

WASHINGTON (AP) — Riding the coattails of a historic health care vote, the House on Sunday also passed a broad reorganization of college aid that affects millions of students and moves President Barack Obama closer to winning yet another of his top domestic policies.

The bill rewrites a four-decades-old student loan program, eliminating its reliance on private lenders and uses the savings to direct $36 billion in new spending to Pell Grants for students in financial need.

In the biggest piece of education legislation since No Child Left Behind nine years ago, the bill would also provide more than $4 billion to historically black colleges and community colleges.

The bill was paired with the expedited health care bill, a marriage of convenience that helped the prospects of each measure. That combined measure passed 220-211.

Read more: http://www.chicagotribune.com/news/politics/sns-ap-us-health-care-student-loans,0,972048.story

[BrklynLiberal]

1. YESSSSSSSSSSSS!!!

[bread_and_roses]

2. at last, something i can support

well done.

[Roland99]

9. +1!

[pipoman]

3. Without pell and student loans

I couldn't have afforded school..good to hear...and it will keep some people out of the empty job market for a while.

[Rozlee]

4. OK, can someone explain something here to me. I have a daughter that is repaying back a loan

I went to school thru the VA, so I'm baffled by the process. She took out the loan originally from her credit union ten years ago. She was paying it back to them. Then to Sallie Mae. Then to four different companies over the years. Her loan went from it's original $8,000 to $19,000. She only took out two forbearances. One for 6 months while she looked for a job and another one for four months while she went to basic and job training in the Coast Guard Reserves. I've read where college students are moving to Europe because they can't afford loans that they took for $40,000 that somehow ballooned to over $100,000. How is this legislation going to help my daughter?

[quiet.american]

5. Here's a link and info you may want to take a look at:

Reform summary - (Student Loan Reform section starts on page 5)
http://docs.house.gov/energycommerce/SECTION_BY_SECTION.pdf

I don't know if the below would apply to your daughter's situation, but there's more at the link.

Section 2203. Termination of Applicable Interest Rates. This section makes a conforming amendment with regard to the termination of the FFEL program limiting interest rate applicability to Stafford, Consolidation, and PLUS loans to those loans made before July 1, 2010.


Section 2206. Federal Consolidation Loans. This section makes conforming changes with regard to the termination of the FFEL program for federal consolidation loans. This section also provides that, for a 1 year period, borrowers who have loans under both the Direct Lending program and the FFEL program, or who have loans under either program as well as loans that have been sold to the Secretary, may consolidate such loans under the Direct Lending program regardless of whether such borrowers have entered repayment on such loans.

[bergie321]

6. I hope

They do more for those of us with existing huge debt loads from private student loans.

[FrenchieCat]

8. I understand you can consolidate those debts,

as the Government will be buying them back from banks.

See here the provisions: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=433x229011

[groundloop]

7. Not sure if anything can be done about existing loans, the govt. would be modifying a contract

The holders of existing loans have signed a contract for whatever the terms are. I may be proven wrong, but I doubt that the govt. would be able to modify the terms of those contracts.

I was lucky enough to be able to take advantage of guaranteed student loans before the days of lenders taking advantage of students. Since lenders, in recent years, have felt the need to screw students I'm all for the government cutting them out of the looop. Fantastic move Mr. President.!!!

[woo me with science]

10. I do wonder what changes may be coming for repayment.

We know several students who are struggling with repayment, and those with loans through the government can now essentially set their payments at what they can afford, which in some cases is next to nothing in this economy.

If all loans now go to the government, I wonder how they can afford to keep doing this.

I am getting less and less sanguine about the government's understanding of the mess people are in with regard to finances. I would like to think that putting student loans in their hands would be a good thing, but the passage of this health insurance bill without any cost cutting at all (after initial proclamations that high costs were the REASON for the overhaul) makes me a little nervous for students with high debt.

[Dappleganger]

11. IT'S A GOVERNMENT TAKEOVER OF BANKS!!!

Banks which administer government loans.

:thumbsup:

[Arkana]

12. This is awesome--I only wish it had come a few years earlier.

Good on the President and Democrats for making it happen.

[pipoman]

13. kick

Where are all of the bitter hcr posters? Here we have truly progressive legislation which is blown off by the perpetual BO bitchers.