Underdog Democratic presidential Martin O'Malley laid out a plan he says will make college degrees debt-free for all students in the next five years at any in-state college or university, as the national student debt tops $1.2 trillion.

The former Maryland governor's ultimate goal is to reduce college tuition to no more than 10 percent of a state's median income for four-year public universities, and to no more than 5 percent at two-year public colleges. He also plans to encourage "competency-based strategies" to help students graduate faster, propose expanding Pell grants and triple work-study programs.

O'Malley formally laid out his plans while in New Hampshire on Wednesday, as his campaign simultaneously shared a white paper entitled "Making College Debt Free For All Americans," laying out the plan's framework.

"Right now, student loan debt is holding us back — student by student, family by family, and as a nation, we have to do better," O'Malley said. "In Maryland, I fought to freeze tuition at public four-year institutions, invested in higher education and financial aid, and took steps to make sure our high school students were graduating with a degree that's worth more. Now is the time we do this as a country."

If college remains unaffordable, the American dream will become increasingly unattainable, he argues. Nearly 70 percent of all graduating college students carry debts, averaging more than $28,000 in loans. O'Malley said that all Americans with student debt should be able to refinance their loans at lower rates and be automatically enrolled in income-based repayment plans with loan forgiveness.

"The student debt crisis is personal to the Governor," O'Malley deputy press secretary Sean Savitt said in an email. "He and his wife took on more than $300k worth of student loan debt to support their daughter's' pursuit of their dreams."

The Democratic hopeful plans to freeze public tuition rates while restoring state higher education funding. He argues that one of the main reasons public tuition has skyrocketed in recent years are the state government budget cuts. As president, he would partner with states to increase education funding and increase college preparedness among high school students.

Debt-free college tuition has already become a major issue in the Democratic primaries, as Hillary Clinton and Bernie Sanders have both pushed policies aimed at addressing this issue.