Obama Administration Strives to Increase Awareness of Income-Based Repayment Program

By Catherine Groux
Posted June 08, 2012 11:14 AM

The Obama Administration is working to make financial aid more transparent.
The Obama Administration is working to make financial aid more transparent.
As the cost of college continues to increase, the Obama Administration is striving to make the financial aid process easier for students. Recently, the White House announced that individuals who take out student loans and apply to the Income-Based Repayment (IBR) program will be able to provide their tax information online beginning in September, The Chronicle of Higher Education reports. In the past, applicants had to contact a loan servicer and give them signed copies of their tax returns.

While this may be only a slight improvement to the financial aid process, the Obama Administration hopes it will encourage more students to take advantage of the IBR program.

"Despite these opportunities and policy improvements to help graduates make their monthly payments, too few responsible borrowers are aware of their repayment options," a White House press release states. "Even among borrowers who are aware of their options, too many have had difficulties navigating and completing the application process."

Currently, only about 700,000 students are taking advantage of the IBR program, which lets them cap their loan payments at 15% of their income, the Chronicle reports. However, White House officials believe many more degree seekers are eligible to apply.

Students can use IBR if their federal student loan debt is high in comparison to their income and family size. This is determined by a loan servicer, but the U.S. Department of Education also offers an IBR calculator, which can give students a good idea of whether or not they will qualify.

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