White Plains College Students Could Benefit under Gov. Cuomo's Loan Forgiveness Proposal

Gov. Andrew Cuomo this week outlined a proposal to change the state’s college loan program that could help students - who attend New York schools and remain in the state after graduating - pay their loans.

Called the “Get on Your Feet Loan Forgiveness Program,” eligible college graduates who earn less than $50,000 a year would not have to make payments on their college loans for the first two years. The proposal is designed to give former students a chance to get established before they have to begin to pay back their college loans.

On average, according to Cuomo, students have more than $25,000 in student loan debt upon graduation.

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“Student loans are one of the greatest challenges that today’s recent college graduates face when starting their careers – and we must do more to give them a full opportunity to succeed,” said Gov. Cuomo in a statement. “By alleviating the weight of student loan debt, we can give our recent graduates a better shot at establishing themselves right here in the Empire State. I’m proud to include this item in my 2015 Opportunity Agenda as it represents another step forward in our goal of growing economic opportunity for New Yorkers.”

The three criteria for eligibility under the proposal are 1.) attending and graduating from a New York college or university, and remaining in the state following graduation; 2.) participating in the federal Pay As You Earn loan program; and 3.) earn less than $50,000 annually after graduating.

From a press release about the proposal:

Graduating from college with unmanageable student loan debt forces graduates, especially low wage graduates, to be faced with difficult choices that can have lasting consequences for them, their families and the New York economy. Because of high student loan debt these graduates are forced to take on other high interest debt to make ends meet creating a vicious cycle where the student can never get out of debt. That, in turn, makes it more difficult to purchase a home, car or have other economic opportunity.

Studies show that students who graduate with debt are less likely to start small business or to purchase a home, and the consequences of defaulting on student loans can prevent a person from ever realizing their goals. Managing the burden in the first years out of college is crucial to starting out strong. In 2008, slightly more than 30 percent of 27-30 year olds had purchased a house, in 2014 that had fallen to 22 percent. Similarly, since 2008 the percentage of 27-30 olds who purchased a car has fallen by more than 6 percent. Helping students at the start can have lasting effects.

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