Thousands in MO Could Benefit From New Student Loan Plan

The Obama Administration announced today it is moving forward with a program to help students manage their loans.

By Rachel Path (Columbia, Mo.)

The White House estimates that 42,000 current students in Missouri will be able to lower their monthly payments through the new “Pay As You Earn” Program. The new plan will allow students to take 10 percent of their discretionary income for a maximum repayment period of 20 years before it is forgiven.

MU’s Interim Director of Financial Aid Nick Prewett said he doesn’t want students to abuse this new program.

“I hope students won’t see this as a mechanism to take out excess student loan debt," he said. "What we want students to do is take out the amount of money that is necessary for them to achieve a graduate or undergraduate degree program. ”

Prewett said there’s been a 27 percent increase in financial aid applications from students over the past year.