President Obama’s executive order of a program designed to cap monthly payments on loans acknowledges that students are often unable to pay their loans back in this economic climate.

The plan, for those who qualify, will reduce the minimum yearly repayment to 10 percent of disposable income.

There are many troubling questions raised by the president’s executive order.

The program does not cover students who took out private loans, or made use of of the PLUS loans advocated by our own Office of Scholarships and Financial Aid. What are these graduates supposed to do?

Why was the federal government unable to act on this issue as a functional body?

Obama going outside the legislative process in order to accomplish what seems like a common-sense measure shows the degree to which our government has ceased to function.

The use of an executive order to support students and graduates shows the extent to which a gridlocked legislature is unwilling to take action on what should be an apolitical issue.

Reducing the minimum payment on loans disregards the cause of students’ massive loan burdens in the first place: constantly rising tuition rates. Allowing students to stop making payments on their loans after 20 years instead of 25 acknowledges the reality that many students are now forced to take on a debt burden for most of their adult lives in order to obtain the education required to be at all competitive in the current economy.

Critics of student loan reform often draw on their own experience of paying for school entirely by working their way through college. This criticism ignores the two-fold issue of skyrocketing tuition and a lack of jobs for Americans.

The program that the 10-percent cap replaces was underused, and there is no guarantee that eligible students will apply for the new program

Obama’s order is a step in the right direction, but the details of the program and the way in which he plans to enact it expose much larger problems in our government and our universities.

Amber Loomis, manager of the Student Service Court, estimated 750 students enrolled in the plan for the fall semester.

The number is significantly more than with the last plan, she said. About 200 used the old plan.

“Not many students took advantage of the last payment plan,” Loomis said. “We have a lot of freshmen using the new system. (But) we’ve got a good mix on all classes.”

Caledonia junior Katie Jonkhoff is using the new payment plan and said she wishes she knew about it sooner.

“Signing up was easy. (It) was all online,” she said. “The whole thing’s been helpful. It’s easy to check.”

The “CMU Payment Plan” is headed by the Office of Student Account Services and University Billing, formerly known as the Office of Receivable Accounting, and requires a non-refundable, $25 per semester fee.

Loomis said none of the money will go to the university. It will go directly to the new vendor, Nelnet Business Solutions.

The previous vendor, Sallie Mae Corporation, charged a $60 fee for the entire academic year, Loomis said.

Moving toward efficiency

While the university always offered a payment plan option, Loomis said she feels this plan is more efficient.

“(Nelnet) offers more flexibility for paying tuition and other semester charges,” she said.

The new payment is useful for most students. The earlier they sign up determines the amount and how many payments will be made.

Any fees incurred from CMU, such as tuition, bookstore charges, parking passes and anything charged to a university student account is eligible for the plan, with the exception of the first payment for fall residence hall fees, according to Student Account Services and University Billing’s Web site.

The plan offers automatic payment dates, which bills the student on the fifth of every month and offers account adjustment to student accounts any time changes occur to the account, such as bookstore refunds, dropping or adding a course or financial aid payments.

With the system, amounts charged to the account will be updated on a regular basis.

While enrollment for the fall semester ended July 31, students who wish to use it for spring can sign up Oct. 1 through Dec. 31.

Is it for you?

The plan, however, is not recommended for everyone, especially students on financial aid, said Diane Fleming, associate director of the Office of Scholarships and Financial Aid.

She said the plan is not beneficial for students utilizing financial aid that covers the full cost of tuition.

Enrollment instructions can be found in the “Finances” tab of the Central Michigan Student Portal.

If students have more questions about the new payment plan, contact the Student Account Services and University Billing at 774-3618.