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Where Hillary Clinton and Donald Trump stand on student debt

After a long election campaign, there are now just a handful of weeks before the presidential election. If you haven’t done so yet, it’s now crunch time when it comes to researching each candidate’s positions on important issues.

For many Americans, one of those important issues is student loans. Around 40 million Americans have student debt and collectively they owe over $1.2 trillion. Today, over 60 percent of college grads are leaving campus with student debt. That debt is becoming a big problem because at least two in five borrowers are late, in default, or have postponed paying their loans because of disability or other financial struggles. While the percentage of people who are not paying their loans is slowly on the decline, we’re still facing a student loan crisis.   

Both presidential candidates have pledged to help tackle the nation's student debt. So what exactly do Donald Trump and Hillary Clinton plan to do to help fix the problem?

Clinton

Hillary Clinton has a clear plan on student debt that is laid out on her website. She proposes that by 2021, families who make less than $125,000 will not have to pay tuition at in-state colleges and universities. She will also ensure that in the interim, students from families making $85,000 per year or less won’t pay tuition at in-state four-year colleges.  

Recently, Clinton launched a calculator that allows you to see how much your family would save for in-state tuition under her plan. Families can plug in their income, where they live, and what kind of college their children plan to attend to get an idea of how much Clinton’s plan will save them.

She also would provide relief for parents attending college, ensure that students could attend community colleges tuition-free, and support colleges and universities that are historically black or serve Hispanic or other minority populations.

On top of these measures to help people who are currently in college or who will be attending school in the future, Clinton has proposed measures to help those who are currently repaying their student loans.

She would allow borrowers to refinance their loans at lower interest rates, shorten all income-based repayment programs to 20 years (after which the remaining balance would be forgiven), and expand income-based repayment programs so more people qualify. She would also open up student loan forgiveness to private loans, reward employers who help employees pay back their student loans, and offer entrepreneurship deferments and entrepreneur student loan forgiveness programs for those who launch businesses in distressed areas.

In addition to all of these plans, Clinton also promises to make private loan servicers improve the services that they offer struggling borrowers.

While these plans are well received among borrowers, experts have questioned how much they will cost. Currently, estimates show the price tag for these new programs could reach $500 billion or more.

Trump

When it comes to student debt plans, what Trump intends to do is a bit less clear than Clinton.

His campaign website makes no specific mention of student loans or debt relief plans and he hasn’t clearly spelled out promises in his platform. But both Trump and people associated with his campaign have talked about what he intends to do.

Trump believes that student debt is a “tremendous problem,” and said during his convention speech that it’s important to do something to help students who find themselves drowning in debt.  

But Trump does not seem to support student loan forgiveness or debt-free college. Instead, he believes an important part of the solution is to help graduates find jobs so that they can repay their loans.

He also mentioned in his 2015 book Crippled America that he doesn’t believe that the government should be profiting off student loans. That could mean that he might decrease interest on federal student loans if elected. Trump has also made comments hinting that he favors privatizing the student loan industry. There are a number of new private student loan refinancing companies looking to lower the cost of student debt. It has been reported that one company, SoFi, has raised over $1 billion in capital to do just this.

Sam Clovis, an advisor with Trump’s campaign, did give a number of interviews about Trump’s positions and claimed that Trump was considering tying student loans to potential job prospects. That could mean that students taking courses in Business or Engineering might easily be able to get loans while those taking an English or History degree might not qualify for federal or private loans. Clovis explained that this system would give students a realistic idea of their future incomes.

In addition to this, Trump recently said that he would work with Congress to make colleges reduce their tuition by cutting various federal funds if colleges don’t reign in their costs.

Who Has the Best Plan?

While Clinton has a more thorough and defined plan, who you believe has the best plan will depend on what you think the solution is to the student loan crisis and how much government intervention you would prefer. Obviously, Trump’s plan will be much cheaper, but whether it will fix the crisis remains to be seen.

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