Image source:  College Candy

BY JING LIU

ANCHOR MEGAN MURPHY

You're watching multisource global video news analysis from Newsy.

Some good news for student loan borrowers-- from President Obama. On Wednesday, the president announced a new plan to ease student loan payments.

NBC Nightly News explains part of the plan. 

“According to White House officials, new graduate loan payments could be capped at 10 percent of the graduate salary. And they say graduates could consolidate their loan payments at lower interest rates. ”

Administration officials say the plan could benefit up to 1.6 million borrowers and reduce their payments by as much as a couple hundred dollars a month. According to The Washington Post, it will finish the goal set by Congress two years earlier than originally planned.

“Under current law, former students are allowed to cap repayments of federal loans at 15 percent of discretionary income. Last year, Congress approved legislation that would reduce the amount to 10 percent in 2014.”

Bloomberg, the New York Daily News, and the San Francisco Chronicle report - the new plan comes as tuition, student debt, and default rates have all been increasing.

“Tuition and fees at U.S. public universities soared 8.3 percent this year, twice the rate of inflation...”

“The amount of loans taken out by students last year hit the $100 billion mark for the first time...” 

“Borrowers are defaulting on their student loans at the highest level since 1997…The latest rate … rose to 8.8 percent in the two years...”

The U.S. Education Secretary says the new plan will be a real benefit for students and their future careers.

But a commentator on Fox News argues-- the president is only trying to help himself.

 “What is Obama trying to do? Why is he here talking about excusing student loan debt, renegotiating student loans let the government take student loan. He’s doing this in the election cycle, in the election year, because he is trying to buy the student, the young vote. I mean, this is so obvious. It’s … and should be illegal.  ”

The president’s plan would also allow for loan forgiveness after 20 years instead of 25.