Student loan debt is still the $1.3 trillion gorilla in the room—one that borrowers could soon have more options to manage.
President Barack Obama announced a new "Student Aid Bill of Rights" Tuesday, directing the Department of Education and other federal agencies to undertake initiatives in three areas to help improve affordability for the estimated 40 million borrowers with federal loans. "We're going to require that the businesses that service your loans provide clear information about how much you owe, what your options are for repaying it, and if you're falling behind, help you get back in good standing with reasonable fees on a reasonable timeline," Obama said during his speech at the Georgia Institute of Technology Tuesday afternoon.
"We're trying to make sure that, across the board, more and more young people can afford to go to college," he said, "And then afterwards, that you're not so burdened with debt that you can't do anything else."
The combination of initiatives could be a boon to students struggling with their debt, said Mark Kantrowitz, senior vice president at Edvisors.com, a network of education resource sites. Graduates in the class of 2013 left college with an average $28,400 in loans, according to the Project on Student Loan Debt. And according to Department of Education figures from the third quarter of 2014, some 7 million borrowers are currently in default for loans totaling $98.1 billion. "If this all gets implemented, it'll certainly be a positive," said Kantrowitz.