New Loan Repayment Program For Unemployed Graduates
A new program aims to assist unemployed college graduates who cannot repay their student loans.
USA Today reports that last week, BridgeSpan Financial introduced SafeSmart, which provides interest-free lines of credit that borrowers can use to repay federal Stafford loans for 36 months up to five years after graduation. The program costs $40 to $60 per $1,000 of student debt, and graduates must be unemployed or have loan payments that exceed 10 percent of their income to qualify.
“Going to college is one of the best investments you can make. We want to take the fear out of borrowing,” explained Carlo Salerno, principal at BridgeSpan Financial, who was quoted in Inside Higher Ed. “If you want to go to college, cost shouldn’t be a barrier to realizing one’s potential.”
The five-year window after graduation during which borrowers can access the free line of credit can be extended for students who return to school or join the Peace Corps. A borrower whose financial situation improves after accessing SafeSmart’s line of credit has another five years to repay the interest-free loan…