Federal Student Loans: Tell Congress to Keep College Affordable for Students and Working Families
Tell Congress to Keep College Affordable for Students and Working Families. US Senator Elizabeth Warren came out with a bold proposal to have students pay the same interest rate on student loans as the big banks pay on their loans while Congress figures out a long-term solution to the problem.
Senator Warren needs our help to get more attention for it in the halls of Washington, in the media, and across the country. We can win this fight and show that Congress needs to respond to an agenda that works for us—not their big corporate backers—but only if we organize together in our communities, on college campuses, and everywhere our representatives can see us in this crucial month ahead.
On July 1, 2013, student loan rates doubled. In June, the Republican controlled House of Representatives voted to eliminate the fixed-interest loans for students entirely. This was a devastating move which could result in “ballooning financing costs” for new graduates struggling to survive in these particularly difficult economic times.
Stafford Loans are federal student loans made available to college and university students to supplement personal and family resources, scholarships, grants, and work-study. Nearly all students are eligible to receive Stafford loans regardless of credit. Stafford loans may be subsidized by the U.S. Government or unsubsidized depending on the student’s need. Stafford loan interest rates for 2012-2013 are currently unknown.
A 2007 law that reduced the interest rate on Stafford Loans from 6.8 percent to 3.4 percent is was extended by one year. Without legislative action, subsidized Stafford loans returned to the 6.8 percent interest rate on July 1, 2013.
Each year, more than ten (10) million students use subsidized Stafford loans to help pay for college. With rising tuition costs, attending college is very difficult for many students, and the increase in interest rates would cause a college education to be out of reach for many college age people. With that knowledge, we must act to ensure that Congress passes legislation to stop student loan interest rates from doubling this summer.
Stafford Loan Information: Eligibility
You must be a U.S. citizen or national, a U.S. permanent resident, or eligible non-citizen accepted for enrollment or attending a school that participates in the Federal Family Education Loan Program. Additionally:
• You must have submitted a FAFSA to be eligible for a Stafford loan
• For subsidized Stafford, you must have financial need as determined by your school
• You must be enrolled or plan to enroll at least half time
When Stafford loan rates doubled, countless students were affected. “We tell our children to get an education, and we owe it to them to keep that door to higher education to the middle class open.” Stafford loans have provided an opportunity for tens of millions of Americans to attend college.
A whopping 7% Stafford interest rate means that our students will be carrying our nation’s deficit. Meanwhile, banks borrow from the federal reserve at an interest rate of about 0.75%. Something just doesn’t add up. Getting an education shouldn’t mean financial devastation. Ask Congress not to double student interest rates!
For up-to-date information on this issue, check out the Student Loan Network Blog.
Tell your elected officials in Washington, DC to take swift action to pass the legislation to keep college affordable for students and working families.