President Obama is set to roll out a plan for student loan reform the administration says will relieve a great deal of stress for borrowers.
The objective of the new plan is to expand the criteria for different repayment programs, capping monthly payments for certain federal student loans.
Those caps would be set at 10-percent of a borrowers discretionary income. According to the new plan, the changes would allow an additional five million borrowers to qualify and would be available starting in December of next year.
Within the new rollout, forgiveness programs for on-time payments and public sector employees. Also, teachers can have their debt balances completely canceled after twn years of payments. Low income borroweres can have their balances canceled after 20 to 25 years of on-time payments.
Those borrowers who don't qualify for those break could repay over a longer period of time, but that would mean paying more as the interest will continue to accrue.
President Obama is set to make the announcement with specifics about the plan at 1:45 Monday afternoon.