Democrats are directing some of their election-year energy on student loan borrowers with two plans that could lower monthly payments for millions. Sen. Elizabeth Warren's bill to allow borrowers to refinance their federal student loans now has the backing of President Obama, who will announce on Monday his own executive action to expand who qualifies for a law that limits loan payments to 10 percent of a borrower's monthly income. And while the plans won't make college more affordable (Warren's bill might not even pass), they could make things a little easier for graduates who've been struggling to keep up with their loans over the last few years.
Obama's executive action
The plan: Obama would expand a 2010 law that limits federal loan payments to 10 percent of a borrower's discretionary income, according to The New York Times. After 20 years your debt is forgiven (or 10 years if you're a public servant). Before, the law only applied to newer loans — if you borrowed your loan before October 2007 or stopped borrowing before October 2011 then you were out of luck.
The executive action would expand income-based repayments to 5 million borrowers starting in December 2015. The action would also encourage lenders to help prevent borrowers from going delinquent on their loans, and work with the Department of Treasury to make sure borrowers know they're eligible for college tuition tax breaks.