Grad PLUS loans eliminated 2017?

[sazerac]

I just read a fluff piece in Business Insider by the guy who runs SoFi, and he seems to think that Grad PLUS loans might be eliminated in the next administration. This was the first I'd heard of that idea. Near as I can tell, the idea and reasoning stems from this policy paper:

http://budgetbook.heritage.org/educ...-social-services/eliminate-plus-loan-program/

On the face of it, the argument seems reasonable, namely that PLUS loans just encourage plus-sized tuition, and the whole program should be cancelled.

Without PLUS, healthcare graduate degrees would be limited to $224,000 to cover the full COA. As an aside, I don't think that even covers full retail tuition at my school.

Has anybody else heard this rumor? Anybody else think this is a good idea?

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[SigmaFS]

I posted this WSJ article (pay wall in place now) on another site several days ago.

http://www.wsj.com/articles/congres...oan-programs-house-republican-says-1481833008

I do believe there will be modifications to the Federal Direct Graduate PLUS program. I don't feel the program will be eliminated (educational lobby will be influential), but annual and aggregate limits will be established. These limits might be phased in over several years. Commercial lenders (i.e., SoFi, Discover, Wells Fargo) will fill the void, but credit standards significantly higher. Commercial lenders would likely require current income (leading to a co-signer) and minimum credit scores.

Should this happen dental schools could be the 1st to realize the effect and most severely impacted as they are the highest cost programs.

 

[Student Loan Planner]

I think we'll almost certainly see limits placed on Grad Plus loans and also repeal of PSLF for new borrowers in 2017

 

[DrMidlife]

I think educational funding is in danger but not on the top 50 list of issues that congress is going to mess with in an organized fashion any time soon. It seems like there's going to be willy-nilly draconian poorly-thought-out legislation coming at us fast, but the work that has to happen behind the scenes to get a bill passed to overturn/change things, even willy-nilly poorly-though-out, is excruciatingly huge. Any given member of congress has only so many staff members who can work on so many things. Take away the effort to get re-elected, and any given member of congress has to pick at most a couple issues, which he/she will work on with multiple other members of congress. Any given issue, without financial backing from an industry for the actual hard bill-writing work, tends to stay in the can on the shelf. Legislation has to get past McConnell and/or Ryan for a floor vote. Whole lot of nope in there.

I also don't think GradPlus is going to be the next Taiwan for PEOTUS. Not tweetable.

So changing GradPlus, while kind of an obvious target for bringing down the tuition of professional school and Doing Something about student loans, is a can of worms on a big fat deep shelf of canned worms. All these cans of worms require taking on The Greater Good despite opposition of industrial organizations (AMA, ADA), stockholders, 7-figure CEOs. And years of negotiations.

I also think it's unlikely that "creative" legislative work, such as REPAYE, will happen in the next 4-12 years.

PSLF though, that's interesting. I think we're one Breitbart story away from somebody noticing the 8 figure forgiveness bill, exposing the "giveaway" and pissing off PEOTUS' base. But not 2017. Maybe 2020.

For what it's worth, I don't think it'd be any different with HRC or Bernie or Kasich as PEOTUS. Not a top 50 issue. (Hmm. Maybe Kasich.)

 

[SigmaFS]

While I think the in-coming administration has an ambitious agenda, the window has likely closed for July 1, 2017 higher education reform with a caveat - PAYE and REPAYE were created by executive order which can eliminated with another stroke of the pen. Grad PLUS & PSLF modification not likely any sooner than July 1, 2018. And a point of clarification, the federal government provides the capital for the federal direct loan program, so no direct incentive for stockholders and 7-figure CEOs, just the disinterested taxpayer.

 

[DrMidlife]

While I think the in-coming administration has an ambitious agenda, the window has likely closed for July 1, 2017 higher education reform with a caveat - PAYE and REPAYE were created by executive order which can eliminated with another stroke of the pen. Grad PLUS & PSLF modification not likely any sooner than July 1, 2018.

Good to know.

And a point of clarification, the federal government provides the capital for the federal direct loan program, so no direct incentive for stockholders and 7-figure CEOs, just the disinterested taxpayer.

The 7 figure CEOs I'm talking about are in the peripheral industries enabled by GradPlus (& maybe PSLF). Such as Navient. Such as Gtown. Such as my alma mater med school on the mid-atlantic that depends on the double tuition paid by west coasters who will do anything to go to med school.

 

[Student Loan Planner]

I've looked into a lot of faculty salary information, and have seen a lot of schools giving incredible 5% annual raises to all of their professors. Make no mistake that there are a bunch of highly motivated professionals whose livelihood depends on ever increasing tuition revenues