SANTA BARBARA, Calif. - Millions of people with federal student loans will be able to cap their payments at 10 percent of what they make.
To break down how the program works, take 150 percent of the Federal Poverty Level, which is $17,505. Whatever a person makes above that amount would be the loan payment.
Student loan debt in the United States is already at more than $1 trillion and this year's graduates are facing their share of the burden. Along with a diploma, the average undergraduate student will walk away with around $30,000 in debt.
There is a program that caps monthly payments for certain federal student loans at 10 percent of the borrower's discretionary income. President Barack Obama signed an executive order extending the limit to borrowers who took out loans before 2007.
"No hard-working person should be priced out of a higher education," said Obama on Monday.
Now close to 5 million more people will qualify by December 2015.
"And some of those students quite frankly have been struggling to make their payments over the years, so it's welcomed news for them," said Michael Miller, UC Santa Barbara's director of financial aid and scholarships.
The hope is to help ease the burden of paying for college.
"The challenge is in helping more young people and their families pay back these loans. And if we can mitigate the cost, the interest rates on the back end, and then have more young people rather than paying back loans, buying houses, buying cars, starting businesses, becoming entrepreneurs, we think that's the right thing to do," said U.S. Education Secretary Arne Duncan.
"Part of this is that 20-year threshold. And I know 20 years is going to sound like a lot but once you make those consecutive payments for 20 years, whatever is left will be forgiven," said Miller.
Some students at UCSB said that is the light at the end of the tunnel.