"More individuals than ever before are using student loans to finance college," Obama said in a release announcing changes in Income-Based Repayment plan for Federal student loans. "Nearly two-thirds of college graduates borrow to pay for college, with an average debt upon graduation of about $26,300."
The plan allows former students to cap monthly loan payments at 15 percent of current discretionary income but Obama said the IBR application process can be challenging.
"For many borrowers, the most significant challenge in completing the IBR application has been the income-verification process, which, until recently, required borrowers to provide a signed copy of their income tax return," he said.
Obama said online applicants will be able to import tax return information directly into the IBR application by Sept. 20.
"This process will allow income information to be seamlessly transmitted so that borrowers can complete the application at one sitting," Obama said.
Obama directed the Secretary of Education to create online and mobile resources to inform borrowers of the IBR and other loan-management programs, as well as ways to make better financial decisions. The secretary will "instruct loan servicers to make borrowers aware of the option to participate in IBR before a student leaves school," Obama said.