There is no “Obama Student Loan Forgiveness Program,” it refers to programs that were implemented while President Obama was in office. These programs focus on repayment rather than forgiveness.
On March 30, 2010, the Health Care and Education Reconciliation Act of 2010 became public law. The most relevant portion of the Act that deals with student loan reform is Part II of Title II: Education and Health.
Part II: Student Loan Reform outlined the following concepts:
- All new federal student loans will originate through the Direct Loan program, instead of the Federal Family Education Loan program (FFEL).
- Loan Servicers are no longer allowed to service both federal and private loans.
- Made modifications to the 2007 Income-Based Repayment program (IBR). Such modifications included:
- Monthly payments of discretionary income were reduced to 10% from 15%.
- Any remaining loan balance (debt) is to be forgiven after 20 years, instead of 25 years.
Since this bill became law it created the following income driven repayment plans:
- Pay As You Earn Repayment Plan (REPAYE Plan)
- Revised Pay As You Earn Repayment Plan (REPAYE Plan)
- Pew Research Center: 5 Facts About Student Loans
- The College Investor: What Is Obama Student Loan Forgiveness
- The College Investor: How RePAYE Changes Student Loan Repayment for the Better
- Student Loans Resolved: The Top Student Loan Forgiveness Programs
- Student Debt Relief: The Top Student Loan Forgiveness Programs
Tanya Mozias Slavin is a former academic and language teacher. She writes articles about education and linguistic technology, and has published in the Washington Post, Fast Company, CBC and other places. Find her at www.tanyamoziasslavin.com