Borrowers hoping to consolidate their student loans through a special program created by President Barack Obama last year have just until Saturday to apply.
To much fanfare, Obama used executive authority in October to launch a short-term initiative to allow borrowers to consolidate multiple loans into a direct government loan — and to knock off as much as a half percentage point from their interest rate in the process. The window to apply opened in early 2012 and ends Saturday.
About 440,000 borrowers with loans totaling $10.6 billion have applied for the program, Education Department officials said. It’s a far cry from the 5.8 million borrowers the White House said in October could be helped by the program. But education policy analysts called it an impressive response from a notoriously hard-to-reach population: recent graduates.
“It’s a fairly large and disbursed population, and how you get the information into their hands is always a challenge,” said Terry Hartle, senior vice president of the American Council on Education.
The problems of paying down student debt and the government’s efforts to make it easier have been largely overshadowed by a longstanding congressional stalemate over a deal to prevent interest rates for student loans from doubling on Sunday, the day after the special consolidation program closes. The House and Senate were poised to vote on a deal Friday to avert the increase.
Borrowers who miss the deadline can still apply for a regular consolidation, but they won’t get the interest rate deduction.
The student debt issue is one Obama hopes will resonate on the campaign trail, where he is counting on avid support from students and young voters who helped him claim victory four years ago. According to 2008 exit polling, voters ages 18-24 broke for Obama 66 to 32 percent. They made up 10 percent of the electorate.
Obama promoted the student loan plan as an economic stimulus measure when he unveiled it in October, using his “We Can’t Wait” slogan to argue that his administration would sidestep Congress when necessary to bring relief to struggling Americans.
“Our economy needs it right now and your future could use a boost right now,” Obama said.
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article courtesy of TheGrio.com