Okay policy squadlings, here's some ideas on how to reform America's student loans education mortgages:
- Undergraduate subsidized loans now have a negative 1% interest rate, which will be applied monthly
- Undergraduate unsubsidized loans will accrue no interest
- Undergraduate subsidized loans will start at $5000 for 1st-year students and will increase by $1000 for each consecutive year the loan is taken, capping out at $10,000
- Undergraduate unsubsidized loans will start at $2500 and will increase by $1500 per year, capping out at $10,000
- Students can register with their employers (before and after graduation) to have their loan repayments be taken out of their paychecks automatically (this will be mandatory for employers to offer and will be coordinated between the IRS/Treasury Department and the Education Department)
- After 10 years of repayments and at least 10% of a loan recipient's income going to repaying loans, the rest of the loan debt should be forgiven. For people who did not graduate, this should be 5 years instead of 10 (I heard Andrew Yang called this a "10-for-10" strategy, and that sounds pretty good... I don't remember if he spoke about people who didn't graduate, tho).
Hold on McMatt, I might hear you say. Just undergraduates? What about students seeking a medical degree or a doctorate or a law degree or--
Okay, yeah yeah, I get it. People do things after 4 years of college and can end up doing great things, but shouldn't be saddled by even more education mortgages, so here's this:
- Graduate (etc.) loans will have the maximum amount of undergraduate loans (this includes both subsidized and unsubsidized loans)
- The interest rate structures will be exactly the same
- Instead of 10-for-10, it's gonna be 12-for-12 (unless you don't graduate, in which case it'll be 12-for-6)
Just a note: You would only repay when you're employed, but you still have to repay for 10/12 years (so if you're unemployed for 2 years, you wouldn't be repaying for those 2 years, so your end date of paying would be pushed back by 2 years).
As always, if I think of something else, it's going into a comment below. Peace, homies
