Relief for college graduates - WBTV 3 News, Weather, Sports, and Traffic for Charlotte, NC

Relief for college graduates

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President Barack Obama wants to offer relief to college graduates.  It is estimated that nearly 60% of North Carolina graduates have debt and about 55% of South Carolina graduates have debt.

Obama made an executive order to limit loan payment for students.  It is called Pay as You Earn. He wants to cap monthly payments to no more than 10% of the student annual salary.  After consistent on time payments, the loan would be forgiven in 20 years and if you are a public servant, like a teacher, the loan would be forgiven in 10 years. 

"We want more young people to start their own businesses," the president said. "To become teachers and nurses and social workers. We want young people to be in a position to pursue their dreams."

Charlotte - Mecklenburg school (CMS) teachers are grateful for the president's plan. Christopher Schotten has been with CMS for two years.  He graduated from Michigan State University with debt. He says he had to get a federal student loan to get his degree.  His payment each month is a couple of hundred dollars.  This is how long it will take him to pay his loan off. 

"The expectation is anywhere from at minimum from 13 year out to 28 years." Schotten said.

Now Schotten could be forgiven of his loans after 10 years of making payments.

"Makes that a little more doable," the teacher said. "And a little bit more bearable knowing that I am not going to spend the rest of my adult life trying to pay back, what basically amounts to a mortgage on my career."

Schotten has plans for the extra money he could soon have.

"Whether that means furthering my education," Schotten said. "A change in location or actually saving for my retirement before it's too late."

Advocacy group Generation Opportunity opposes Obama's plan.  Leaders believe they will transfer the debt to others.

"We're concerned that the National debt is already so high," Generation Opportunity Spokesperson Corie Whalen Stephens said. "And that it is essentially debt tax on the millennial generation to begin with, so it's kind of just rearranging debt chairs on the Titanic and not addressing the underlying problem."

The group believes the government should tackle why college is so expensive and leave the collection to the lenders. 

Obama claims his plan will not cost the taxpayer extra.  His plan starts December 2015.

For more on Obama's plan, click here.

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