Transcript for Student Loan Forgiveness: Obama's Debt Solutions
One of the things inflaming the protesters a lot of other people in this country as well student loans the crushing debt today we learn. That tuition and fees at public colleges have just this year increased more than 8%. Just this year. And that's twice the rate of inflation a private colleges 4%. And so many of you've been writing us about the mountain of debt. That you have acquired just to get a college education so steep you've said you can't breathe and one mother pointed out. It will take her and -- 2031. To pay off for college loan. Justice -- toddler starts college in 2032. And tonight ABC's David Muir tells us about a new plan announced by the president and whether it will help. We heard from you loud and clear college students drowning in debt and so many middle class parents once again providing -- roof over their heads. New numbers tonight show that in the last decade alone skyrocketing tuition -- out of undergraduate borrowing has increased by 57%. Two thirds of graduates now all an average of 28000 dollars when they -- and many -- far more. Today President Obama signaled He knows that -- fast tracking a move by congress to allow borrowers to adjust their monthly payments based on what they earn. They know more than 10% of their discretionary income that's the money left over after shelter and food on those college loans. The president speaking of his in the first lady's own college debt paid off just a few years before He was president. So by the time we both graduated from law school. We -- between us about a 128000. Dollars worth of debt. You know we. We we combined and got four together. -- a teacher making 30000 dollars a year who owes 60000 in federal loans. His -- her monthly payment would be reduced by more than 500 dollars from 690 dollars a month to 113 dollars a month. But what about some of the students who reached out to us with those three words one saying -- monthly payment the other going nowhere fast this -- -- around. Ashley -- in Dallas back in her childhood that would have the six million. Move back home. She's four student loans and owes nearly 70000 dollars the president's new numbers don't help her they only apply to borrowers starting next year. And or something else of Ashley's for student loans three. The president's plan does nothing to rein in the rates on those -- There under regulated and very risky particularly the variable rate loans which like sub prime mortgages can spike in costs at a moment's notice. And millions of students in this country hold those private loans to its next generation just starting out deep in debt. With few jobs available to pay for that education. As this downturn continues. You are seeing the potential of an economically Lost Generation young people. -- -- taking years to get on the escalator to move into stable employment. Now those private college loans so many experts say are the next shoe to drop for parents and students who took about to get through college. You heard them compared to sub prime mortgages there are only -- -- -- can't walk away from them ever. And -- -- the president also talking about consolidating federal loans to bring the interest rate down we learned today that you can do that already. And many students and parents out there don't know they can do that with their children so we put tips online to get them going right away.
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