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Letter: Student loans are commonly misunderstood

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I’m writing about the editorial: "Proactive plan to prevent college debt would benefit students."

With the goal of clarifying some of the statements contained therein, I hope to assist with a better understanding of the student loan issue.

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My first clarification involves the most misunderstood topic about student loans. For those on the Income Based Recovery (“IBR”) plans, which is the vast majority of students, payments are not designed to pay off their loans as they would be for a car loan because payments are “Income Based” or in other words, the normal calculation of payments doesn’t occur because they’re based on income. And the large balances continually referenced are irrelevant because, unlike normal loans, these loans are written off in 10, 20, or 25 years provided one makes minimal payments based on income throughout. Ten if one does public interest work, 20 or 25 depending on when the loan was initiated.

Student loans should never prevent someone from buying a house. By explaining the payment plan to the bank, people whose initial request was denied will have their mortgage approved. And students should never drown in a “sea of student debt” making minimal payments based on income because the debt amount is eventually written off.

I agree that to solve the problem, America must change the way higher education is paid for which is why I’ve suggested the government should standardize the terms and retroactively lower the interest rate to 1-2% to cover the cost of servicing the loans.


Christopher Owen, Las Vegas, Nevada

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