A new bill is circulating Congress that would alleviate the pressures facing students struggling to repay college loans.
The Student Loan Forgiveness Act of 2012, introduced to the House by Representative Hansen Clarke (D-Mich.), would reduce the debt of students who have already repaid a substantial portion of their loans over the past decade.
The act, which currently has over a million signatures on the petition website signon.org, aims to stimulate the economy by increasing the amount of available income students -- otherwise theoretically debt-bound -- would have to invest and spend.
"Students who studied hard, played by the rules, and are now desperate to find work are being denied basic opportunities and are, accordingly, falling behind on payments. They are finding that their degrees, like homes at the height of the real estate bubble, were vastly mispriced assets that are now hard to finance," wrote Representative Clarke in a blog post for the HuffPost. "We must set these students free."
Not all current students are sanguine about the bill. "That may help students like me in the future," high school senior George Edwards writes of the bill in the New York Times, "but I have to make a decision now about whether I am willing to take out loans to pay for my education."
Under the bill, a 10-10 standard is used as the criteria for student loan forgiveness. If a student has made payments equal to 10 percent of his discretionary income for 10 years, remaining federal student loan debt is forgiven.
Students who have already paid 10 percent of their discretionary income for 10 years will immediately qualify for debt forgiveness, according to an FAQ.
Additionally, the forgiven debt would not be counted as taxable income and interest rates on federal loans would be capped at 3.4 percent.
In 2010, total outstanding student loan debt exceeded total outstanding credit card debt for the first time. By the end of this year, total outstanding student loan debt is predicted to exceed $1 trillion. As college tuition soars even in troubled economic times, students increasingly find themselves mired in debt upon graduation.
"There's finally hope on the horizon!" the petition site reads. "Support a REAL economic stimulus and jobs plan."
Brittany Baker, Allegheny College/Sarah Lawrence College
I'm all for paying high prices for good value -- and my education was certainly of quality -- but I'm not in the market to be abused. From interest rates to the ease of borrowing, to confusion of terms and steadily climbing price of college tuition, I guess I have to thank all of the higher education system while I have the floor to speak. To the loan companies, the banks and private colleges: thank you. I and my peers will forever be indebted to you. <a href="http://www.huffingtonpost.com/brittany-baker/debt-up-to-my-neck_b_945267.html" target="_hplink">Read more...</a>
Mike Vattuone, UC-Berkeley
I currently owe around $23,000 not including interest and Parent PLUS loans, which my mother is still generously paying off. She is 60 years old and works 11 to 12 hour days selling flooring, which her employers pay on commission and only if no mistakes are made. She can't retire because she has to help me pay back my loans, and she won't let me pay the PLUS loans myself. It's very frustrating. <a href="http://www.huffingtonpost.com/mike-vattuone/colleges-catch22_b_945213.html" target="_hplink">Read more...</a>
Quinn Anderson, Boise State
As an average, working-class, white American male who is neither left-handed nor a great athlete, the options for scholarships available to me have always been slim. Combine that with my parents' income -- which is above Pell Grant eligibility and too high to be considered for greater loan amounts -- and you get my situation. At the end of the spring 2012 semester I will be $50,000 plus in debt, which means I will have reached my loan cap for borrowing. With a credit rating that sunk to an embarrassing low years ago, there is no way for me to borrow using private loans to finance my education. <a href="http://www.huffingtonpost.com/quinn-anderson/quinn-anderson-27-boise-s_b_943879.html" target="_hplink">Read more...</a>
Laquinda Settles, New York Institute of Technology
I graduated from the New York Institute of Technology in May 2010 with a degree in Communication Arts; I am currently working 2 part-time jobs with no benefits and making $12 an hour. I'm also so over my head in debt with college loans. It's to the point that I'm considering filing for bankruptcy. I went to college to educate myself and make more money, but it feels like I dug my own grave. College is one of the biggest scams in the world; some of these institutions charge students between $700-$800 per credit for an undergrad degree. <a href="http://www.huffingtonpost.com/laquinda-settles/a-degree-in-hand-but-what_b_951098.html" target="_hplink">Read more...</a>
Aleesha Nash, New York University
I am a 31-year old woman originally from Ohio working and living in New York City area. I graduated with a Master's degree in Speech and Interpersonal Communications from New York University's Steinhardt School of Culture, Education, and Human Development in 2007. Logging into the Federal Student Aid website I see that today my balance is $104,104.63 for a percentage of the information in my head. <a href="http://www.huffingtonpost.com/aleesha-nash/debt-thats-worth-it_b_945223.html" target="_hplink">Read more...</a>
Jaclyn Cabral, Elon University
I am a recent graduate from Elon University, a private school in North Carolina, and have $90,808 of college debt. Though my debt seems extremely high, Elon is also regarded as one of the most affordable private college educations. My story dates back to high school where my parents worked opposing shifts simply to make ends meet. I knew since middle school that I would go to a great college and venture away from my hometown. My motivation during the past 17 years of my educational career was to do well, go to a great college and then have no problem landing my dream job. <a href="http://www.huffingtonpost.com/jaclyn-cabral/post_2357_b_945238.html" target="_hplink">Read more...</a>
Mike Newman, Ohio State University
I graduated from the Ohio State University with a fine arts degree in 2004. This is what I settled on after changing my major four times in my first three years at school. Clearly college wasn't for me, but I finished it because I wanted to make my parents proud and thought it would improve my life. Neither of my parents went to college, but they managed a pretty good life for themselves. Like all loving parents they wanted me to have a better life than them and were duped into believing that college was the answer. From the first day in elementary school to my last day in high school, we believed the myth that college was the only real path to success. <a href="http://www.huffingtonpost.com/mike-newman/forced-to-fall-off-the-gr_b_945263.html" target="_hplink">Read more...</a>
Brandon Woods, Hampton University
I turned down a full ride at Michigan State (a school that ranks in the top 20 in my field, education) to get the HBCU (Historically Black College and University) experience at Hampton University. It was the best thing I could have done as far as experiences go, but the worst for my finances. They say you can't put a price on experience, but I can. Roughly $24,000 my freshman year, and it only got more expensive every year after that. <a href="http://www.huffingtonpost.com/brandon-woods/i-should-have-listened-to_b_951080.html" target="_hplink">Read more...</a>
Erin Dunphy, Ithaca College
I grew up with an insatiable need to explore the world around me. So I knew when I was going to go to college I was going to do two things: One, major in journalism and two, leave my home. It was time for me to blaze my own path. I had worked hard throughout high school and did all those things they tell you to do to get as much money out of the process as possible. I was an honors graduate and was involved in almost every kind of extracurricular activity. I did my best to be the girl any college would want -- and therefore would hopefully give money that she wouldn't have to pay back. <a href="http://www.huffingtonpost.com/erin-dunphy/excited-for-the-future-ev_b_945253.html" target="_hplink">Read more....</a>