Please welcome the return of special guest Jenny L. Maxey, blogger and author about financing higher education with minimal debt and maximum opportunities. Read Jenny’s important post about how to keep up with the frequent changes in student loan laws and get involved beyond staying informed:
Summer seems to be the designated time of year to get down to student loan business on Capitol Hill, attempting to beat whatever impending change will go into effect on July 1st. In 2013, a new law was passed tying Federal Direct Loans and PLUS loans to the rates of the Treasury plus a fixed rate based on the type of loan. These rates are determined in the spring and then are fixed for the life of that loan. This summer, the U.S. Department of Education has made a regulatory change to help those in default calculate a repayment plan similar to those not in default using the Income Based Repayment plan, allowing some to have repayments as low as $5. Further, President Obama signed an executive order to go into effect December of 2015 that alters repayment plans to extend repayment in order to become more manageable, especially for older borrowers.
The changes come from all over – legislative, executive, administrative. How are you or your college-bound student expected to keep up with it all? Can you? Here are a few levels of activity to help you keep informed about the political side of student loans.
LEVEL ONE: Maybe you and your college-bound student have better things to do than follow the ever-changing squabbles on Capitol Hill. However, it is important to be informed about the influence those changes can have on the debt you and/or college-bound student are taking on. Here are a few easy ways to keep up-to-date.
- Before you sign the terms, make sure you understand what is in them. You’ll need to do this every year, but it’s only once a year.
- If you don’t understand the terms, visit studentloan.gov to get the most up-to-date information on government loans.
- Speak with your Financial Aid office for additional help in understanding any changes.
LEVEL TWO: If you have an opportunity to dig a little deeper, try these steps in addition to Level One.
- Add a Google Alert. You can put in keywords such as “student loans” or “federal loans” and receive daily, weekly or monthly updates on what changes are being ensued. Learn how to set up a Google Alert HERE.
- Do some bill tracking. While this only follows the changes made legislatively, you can follow the debates and where your elected representatives are hoping to steer the conversation. You can track bills HERE.
LEVEL THREE: Do you want to do more than just stay informed? Get active! Have an effect on the outcome. After all, it’s you and/or your college-bound student who are taking on this debt. Now that you know the news and are tracking legislation, you can email or call your state and local representatives and ask them where they stand and give your opinion on the matter. Your effort might make the difference in how the issue is amended or voted upon.
Jenny L. Maxey is the author of Barrister on a Budget: Investing in Law School…without Breaking the Bank. Jenny earned a Master’s degree in Public Administration and a J.D., and is licensed to practice law in Ohio. Although her book is geared toward pre-law and law students, most of the information can be easily applied to any level of higher education. Barrister on a Budget is available on Amazon.com and Barnes & Noble Nook. You can find more information and follow her blog on www.jennylmaxey.com.