The White House should grant a student loan amnesty which allows current student loan debtors to make an extra payment toward their student loan debt in which 100% goes towards principle. This would only apply to Federal Student Loans such as Direct Loans.
Currently, student loan debtors signed up for Pay As You Earn and Income Based Repayment plans accrue unpaid interest on their loans. This accrued interest must be paid off before any loan payment goes toward the principle balance. After a few years on these repayment plans, it becomes increasing difficult to pay off the large amount of accrued interest as more interest is accruing. This proposal will allow debtors to attack the root of the problem by making an additional principle only payment during a set period of time or permanently.
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