Independent U.S. Sen. Angus King introduced a federal student loan bill Tuesday allowing consolidation of debts into either a 10-year fixed repayment plan or a single, income-based repayment option with payments limited to 15 percent of a person’s discretionary income.

“Getting a handle on college debt after graduation is already hard enough without the red tape and maze of student loan repayments that come with it. Not only are students left with confusing repayment options, but if they default on them, then the American taxpayer is stuck footing the bill,” said King, who co-sponsored the bill with Sen. Richard Burr, R-North Carolina.

Currently there are up to 12 options for federal student loan repayment, the senators noted in an opinion piece published in the Portland Press Herald on Tuesday.

“Some of these options provide benefits only if a student chooses to opt in, meaning that the most useful program isn’t necessarily the default option for that student. In addition, benefits available from one repayment program can overlap with others in different programs, leading to confusion about which option is best for the student. And this is all made worse by the fact that some programs with the same name carry substantially different terms and conditions,” they wrote. “Confused? Welcome to the club.”

Reforming the federal government’s student loan system has been a top education issue in recent years, as student loan debt nationwide surpassed $1 trillion.

Last year, President Obama signed legislation cutting interest rates on some federal student loans, fixing the rates to the 10-year U.S. Treasury note, creating interest rate ceilings and locking in rates for the lifetime of a loan. Earlier this year he signed an executive order to expand a program that lets borrowers pay no more than 10 percent of their income every month.

This proposal joins an effort by Sen. Elizabeth Warren, D-Massachusetts, to allow debtors to refinance old student loans with lower current interest rates.

Under the senators’ proposal, debtors would be able to switch between either the fixed repayment plan or the income-based repayment plan as needed.

The bill would also close a loophole in current repayment law that allows some high-income earners to have their loans forgiven after 10 years if they take a public service job. Currently, the repayment amount for those debtors is calculated and capped at the beginning of the 10-year repayment period. Under this proposal, the repayment amount is recalculated regularly so the amount owed goes up as income rises. Some debtors, such as those with certain qualifying legal jobs, can earn significantly more towards the end of the 10-year period.

“Stories of hundreds of thousands of dollars being forgiven are inconsistent with the goal of the income-based repayment program, which is intended to assist needy students who borrow responsibly for college,” the senators wrote.

Under the income-based option, loans for less than $57,500 would be forgiven after 20 years, and those for more would be forgiven after 25 years.

“These are commonsense changes supported by broad groups of stakeholders who want to see these programs become sustainable and user-friendly,” the lawmakers said in a joint news release. “This legislation is estimated to save taxpayers hundreds of millions of dollars over the next decade.”

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