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WNIJ's summary of news items around our state.

New Student Loan Program Gives Yearly Estimates Of Debt

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Garrett Wise graduated from Northern Illinois University just over three years ago. As he strode across the stage and collected his Bachelor's degree in applied physics, he knew that, like most students, he accumulated student loan debt. He just didn't know how bad it was.

Every student who takes out federal student loans must complete so-called "exit counseling" after they graduate and before their first bill comes due. This is where Wise found out how much he'd pay per month and how much money the government expected him to make per year.

"And it was, I want to say, $120,000 a year," Wise said. "It was definitely over $100,000 for just after undergrad what you should be making."

His debt amounted to $85,000 worth of federal and private loans. That's what brought his salary estimate up over six figures.

"I knew when I saw it that there was no way," Wise said.

"I have two cousins that both did physics. One of them has his Ph.D. and the other has his Master's, and the one with his Master's -- he's making, I want to say, just shy of $50,000 a year with a Master's degree," he said.

For many, student loans can be a blight on their credit. It's like a dark cloud hovering over your head for years, even decades. And for many, like Wise, it's hard for students to know the gravity until it's too late to do anything about it.

That's why Illinois is launching a new student loan information pilot program that takes effect in the 2019-2020 school year. Illinois public colleges and universities will give students or their parents information about the state of their loans on a yearly basis.

They'll give estimates of total loan amounts, total payoff amounts, projected monthly repayment amounts including interest, what percent of the borrowing limit you've reached, as well as any financial resources available to the student or the parent or guardian.

"The schools have this information," said Lynne Baker, managing director of communications at the Illinois Student Assistance Commission (ISAC). They're helping schools roll out this initiative.

"They've always had this information, and in fact, basically, most of the information is available and given to students through the federally mandated entrance and exit counseling that they get," Baker said.

The key difference is that this is an annual letter. "Entrance and exit counseling is really just at the beginning before their first loan is dispersed and then when they graduate," she said.

Baker said the individual institutions have freedom to decide when during the year and how exactly they want to present the information.

"Certainly it might help open some students' eyes and sort of keep in front of them this idea of 'This is how much you have to pay back,'" said Baker. "Now, what they do with that information is a different story."

Most schools are still in the planning process since the information doesn't have to be released until the next school year. They're also still waiting for more guidance from ISAC. Experts say it's difficult to give accurate projections with so many repayment options and loan types.

Garrett Wise thinks programs, like the loan information one, would have made a difference for him.

"I think I probably would have reconsidered, not necessarily finishing school, but the amount of time I was going to take to do it. I might have taken some time off to work off some of those loans and then come back later," said Wise.

For now, all he can do is continue to cut into his balance within his repayment plan.

"I'm making more money now," he said. "I'm making enough that I can actually make the payments and sort of get by. But not enough to really start a savings."

He's working full-time as a chemist now. It's close enough to his major. He's in a lab, it's in a science field -- He'll take it, he says. But he's still living at his parents' house.

"So far, I've gotten down to about $78,000. I've only knocked around $7,000 off my grand total," he said. "It doesn't seem like it's making much progress."

The loan information program will end after the 2022-2023 school year unless new legislation is passed or schools continue it on their own.

Since 1990, average tuition and fees at four-year public institutions rose by 156 percent, according to a report by the Levy Economics Institute of Bard College.

On top of that, the Federal Reserve says student loan delinquency reached nine percent in 2017. That means nine percent of all student loans were 90 days or longer past due.