An estimated two-thirds of college students borrow money to pay for college, and the federal government is trying to make the process easier.
In an effort to increase student awareness of the options they have to manage loan debt, President Barack Obama announced the government will develop a streamlined loan application process and integrated online and mobile resources by the end of September.
According to a memorandum released by the White House, the average student who uses loans to pay for college graduates with about $26,300 of debt.
The memorandum said too many borrowers are unaware of their options to manage student loan debt, and many borrowers have difficulty completing the application process.
Shirley Ort, director of the UNC Office of Scholarships and Student Aid, said many students do not know what their options are because the topic of student aid is complicated.
More than one-third of seniors graduating from UNC have borrowed money, she said.
“Students, just like the rest of us adults, learn what they need to know just in time,” Ort said.
“It is not going to be in the front of their mind until they have to start repaying.”
Income-based repayment — which was introduced in 2007 — currently allows former students with a high debt-to-income ratio to cap their debt payments at 15 percent of their income. This amount will be reduced to 10 percent starting in 2014.