President Obama -
Please allow ALL federal education loan debtors to refinance their student loan interest rate to a lower rate. Student loan debt is crushing the people who can do the most to stimulate the economy. Rather than making contributions to the economy by starting a company, or even purchasing consumer goods, houses, cars, etc. Instead, we are resigned to repay our student loans at a rate that is unchangeable and onerous.
Student loan debtors usually do not own a home, yet have the equivalent of a mortgage, and a mortgage that can not be discharged in bankruptcy, assigned or refinanced. This is crippling the people who would otherwise be jump-starting the economy.
This problem is not limited to current students, but ALL individuals who borrowed money to invest in their future, a future that appears to allow us to eke out a living while all other income services the cost of education.
Currently, banks are borrowing money at less than 1% interest and not adding any liquidity to the market. Companies are sitting on huge piles of cash, citing a lack of demand for their products as a reason to not increase capacity (aka jobs). Reducing the prevailing interest rate on student loan debt by half, would put more money in the pockets of regular Americans. This will result in more money in the economy and may compel companies and banks to start hiring and lending.
There is little downside to this proposal. We are not asking for debt forgiveness. All loans will be repaid. We are asking for a change to the amount of interest we pay. For a debtor with $50,000 in loans paying 7% interest per year, reducing the rate to 3.5% would put $1,750 back in their pocket. This would allow greater payments to principal thereby reducing the debt burden on ordinary people. The cost to the Government is minimal, but the benefit to the economy is substantial. Borrowers will come out of debt faster, thereby having more income to contribute to the economy.
We urge you to consider this petition. Help us help the economy and the Country.