Effort To Keep Student Loan Interest Rates Low Gains Bipartisan Support

Yesterday, presumed Republican candidate for President Mitt Romney mentioned his support for extending the current cap on interest rates for federal Stafford student loans, meaning that this is one issue both candidates appear to agree on. The question is, can something be done before those interest rates double in July?

Since 2007, interest rates for Stafford loans have dropped incrementally from 6.8% to their current level of 3.4%, in accordance with regulation intended to make it less of a pain to borrow money to pay for an education.

But the deadline on that interest rate cap is set to expire July 1. If the cap goes away, those rates go back to the original 6.8%.

Student loan debt already stands at nearly $900 billion in the U.S., more than either credit card or auto loan debt. If the interest rate on Stafford loans reverts to 6.8%, that hole could get even larger, as more than 7 million Americans will each be paying thousands of additional dollars.

Additionally, Stafford loan debt can generally not be discharged through bankruptcy, so the debt will remain even after others have been decreased or written off.

A vote is expected in the Senate in the coming weeks on legislation that would keep the current interest rate in place. Our pals at Consumers Union are urging lawmakers to act now.

“Students and their parents are already struggling to keep up with the runaway costs of paying for college,” said Suzanne Martindale, staff attorney for Consumers Union. “Now is not the time to pile thousands of dollars in more debt on their backs by allowing student loan interest rates to double. Keeping interest rates low will help students afford the education they need to stay competitive in today’s tough job market. Congress should invest in our future and side with students and their families by extending the interest rate cap.”

Back in March, more than 130,000 students signed a petition asking Congress to extend the lower rates. The petition was delivered on the steps of the U.S. Capitol, though we assume it could probably have been sent in the mail.

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  1. HomerSimpson says:

    But…but…but…teh free market! Deadbeat losers kids looking for handouts! Terrorists will win! Booga booga booga!

  2. Herbz says:

    As a student who had to pay 6.8% on my subsidized loans, I’ll say:
    1.) I wish my rates were lower too (wheres the love? Can’t reduce loans for people who already gradated?)
    2.) Don’t get in debt if you can’t handle the interest rates. I knew my job would pay well, thats why I took out loans to get it.

    • Cat says:

      Obviously, people who already gradated paid too much for their college education.

    • clippy2.0 says:

      I know alot of folks like to blame students for student debt, that they shouldn’t go to school for degrees that don’t pay well, blah blah blah; I think there is a large amount of blame to place back on the schools. I remember in my high school, during sophmore year we already had to select an focus for graduation (science, business, engineering, medical, ect ect) so that we could take college credit courses to ready us for college. A large amount of junior year was spent purely on college prep, learning how to apply, applying to as many schools as possible, how to handle the interviews, ect ect. Senior year was another push to get accepted to as many schools as possible so you could have options. Basically, half of high school was spent trying to get into school,

      No one really ever mentions you have to pay for it, and that more importantly, you need to get a job to be able to afford the loans you take out just to get a degree for a job who’s median salary is still less than the student loan amount. High school into college, and even through college, is a blur for young adults who need guidance. And no one ever really wants to say “The career you have in mind will be impossible to get into, and you will most likely wind up with a low paying job that doesn’t require the degree you spent so much on”. I think part of the college prep process really needs to bring some realism into the picture; there is no reason for you to apply to Harvard if you won’t get a full scholarship, especially for a media relations degree (for example)

      • whogots is "not computer knowledgeable" says:

        Even after you get to college, the financial aid office isn’t exactly falling all over itself to educate you. My previous school in [redacted], a community college that had grown into a large state university, actively pushed costly guarantors for Stafford loans. The state sponsors a very low-cost option, which [Redacted] State University never, ever, ever mentioned anywhere. Total load of scammy kickbacksauce.

        • sponica says:

          omg…yeah. they operate on a need to know basis. I didn’t even KNOW about Direct Loans because unlike every other federal loan program I had used, they weren’t part of my financial aid package in grad school. Ended up using the soulsucker Sallie Mae to finance the first yr of grad school when I could have applied for a Direct Loan.

    • thefncrow says:

      Out of curiousity, when did you go to college? Loans disbursed prior to July 1, 2006 were variable-rate loans (which are really a better deal in this economy than the flat-rate loans). All unsubsidized Stafford loans since then have been at 6.8%, but subsidized Staffords were only at 6.8% between 7/1/2006 and 7/1/2008, after which point they dropped to 6%, then 5.6% the next year, 4.5% the year after that, and 3.4% this year.

      For you to have paid 6.8% on all your subsidized loans, your would have to only have subsidized Stafford loans from within the 7/1/2006 – 7/1/2008 window.

    • Tacojelly says:

      While you probably went to a decent school and got a decent job, it doesn’t always work that way.

      1) For profit schools will push you to take out loans with false promises (I believe they make up a 1/3 of student debt) and leave with a piece of paper that isn’t worth the ink it’s printed with.

      2) Many hard working students graduated between 2007-2009 (me included). It took me more than 4 years to find a job that paid more than just rent and food; that’s a lot of time for interest to grow.

      • CommonSense(‡≤†_‡≤†) says:

        What was your major that swayed you to get a bunch of loans for?
        Certainly it was not a major that you knew in advance was not going to pay well.

      • Herbz says:

        1.) Don’t go to a for-profit school.
        Your local community college is probably better and costs WAY less.

        2.) Yes it is… but you probably should have known this before going to school to get a degree that wouldn’t land you a job right away. Planning is key.

    • sponica says:

      Mine were 6.8 in school but dropped to 4, because I consolidated the 6.8% Direct Loans with the non-direct Stafford Loans that were a variable rate and had dropped to 2ish percent while I was in grad school.

      And economies change…the jobs I was planning on getting before grad school weren’t there 3 years later. At least not in decent numbers, and there were too many applicants per available position.

  3. Nigerian prince looking for business partner says:

    Between the Bush tax cuts, the Obama payroll tax cuts, child tax credit, and the Stafford loan rate reduction, I think it’s safe to say nothing is ever “temporary” in the eyes of the government.

  4. Blueskylaw says:

    If the government could cut the hundreds of billions if not trillions of dollars from waste and pork barrel spending, then they could afford to spend it on things that really matter, like the education of our youth.

    $107,000 to study the sex life of the Japanese quail.
    $1.2 million to study the breeding habits of the woodchuck.
    $150,000 to study the Hatfield-McCoy feud.
    $84,000 to find out why people fall in love.
    $1 million to study why people don’t ride bikes to work.
    $19 million to examine gas emissions from cow flatulence.
    $144,000 to see if pigeons follow human economic laws.
    Funds to study the cause of rudeness on tennis courts and examine smiling patterns in bowling alleys.
    $219,000 to teach college students how to watch television.
    $2 million to construct an ancient Hawaiian canoe.
    $20 million for a demonstration project to build wooden bridges.
    $160,000 to study if you can hex an opponent by drawing an X on his chest.
    $800,000 for a restroom on Mt. McKinley.
    $100,000 to study how to avoid falling spacecraft.
    $16,000 to study the operation of the komungo, a Korean stringed instrument.
    $1 million to preserve a sewer in Trenton, NJ, as a historic monument.
    $6,000 for a document on Worcestershire sauce.
    $10,000 to study the effect of naval communications on a bull’s potency.
    $100,000 to research soybean-based ink.
    $1 million for a Seafood Consumer Center.
    $57,000 spent by the Executive Branch for gold-embossed playing cards on Air Force Two.

    • partofme says:

      Where did you get this list? Also, I’m having fun thinking about how my own legitimate research (with very practical applications) could be phrased in such a way. I know one of my profs said he avoided telling people that he was studying how the ends of garden hoses move, because that was the example he was using while working on bifurcation theory.

    • clippy2.0 says:

      A few of those I think are shockingly low ($100,000 to study how to avoid falling spacecraft). Also, some of them seem worthwhile ($1 million for a Seafood Consumer Center).

      However, most of the list is pure win of wasteful crap. Government grants are a double edged sword; it’s nice that the government will give money to researchers for a worthwhile cause; however it seems folks have a hard time grasping the concept of “worthwhile”

      • Nigerian prince looking for business partner says:

        Yeah, I think a lot of those are most likely NSF grants to research universities.

        I have no doubt there is waste and some of those definitely apply but in general, just about any research grant can be contorted into a way to sound ridiculous. A few years ago, a politician (I think Palin) went on some tirade about spending money to study “fruit fly reproduction”, completely missing the point to how important fruit flies are to many different genetic studies.

        I’m sure my own graduate research (I had about $10,000 from the NSF) could have been twisted too. It was so specific (studying the Holocene/Pleistocene transition), that it probably would have been of little interest to anyone besides a biologist, geologist, climatologist, or geomorphologist. I’m sure somebody could contort it as being “$10,000 to study dirt in the ground”.

    • castlecraver says:

      That’s not really where the waste is. Any list like that which doesn’t begin and end with $X trillion for “nationbuilding” or $X billion for “security theater” has zero merit in my book.

      Further, only a truly shortsighted simpleton would assert those aren’t things that “really matter.” You have no idea what the goal is, what the implications for citizens and the environment might be when you distill projects down to pithy line-items. Is there some waste there? Probably. Is it fair to beg an either/or argument between them and funding education (where even budgetary, none exists), when more than a few of those could certainly impact education and those being educated? Absolutely not.

    • RvLeshrac says:

      I can come up with reasonable explanations for all of those studies. You could, too, if you could pull your head out of your ass long enough to read a book.

      You must be one of those “victims” of our educational system that people like you are always telling us about.

  5. AcctbyDay says:

    I wish the loans I had taken out before the interest rate reductions were grandfathered and altered with lower interest rates.

    I *wish*, too bad it is not so. For a debt that is virtually impossible (death is one way) to escape, the rates should be cheaper.

  6. sir_eccles says:

    Odd how politicians can change their mind in an election year.

    • rushevents says:

      Democrat controlled congress passed this law with a 5 year limit precisely so it would be an election year political football.

      If the GOP votes against it the dems win because the GOP hates college students – especially poor ones.

      If the GOP votes for it then the Dems win because without them putting pressure on the GOP, who hates college students – especially poor ones, they never would have gone along with it in the first place.

      Man it’s a good thing we’re all too blind to see an agenda at work.

      • rushevents says:

        Oh and we are now past 1100 days without a congressional budget – a duty required by the US constitution.

        Budgets? We don’t need no stinkin’ budgets!

  7. madrigal says:

    Stafford loans for graduate students end July 1. This is going to make financial aid for the fall so much fun.

  8. crispyduck13 says:

    I don’t understand what they would expect to gain by allowing these rates to go back up. Talk about screwing your future for short term gain.

    If it’s more expensive it is to borrow money to pay for college then fewer people will be able to graduate. If you don’t graduate with a degree you make X less dollars in income over your lifetime (I’m too lazy to find this statistic, but I’m sure you’ve seen it), which means the government takes Y less tax money from your paycheck. I’m willing to bet that Y is a greater sum than the extra money they’d rake in on the increased interest.

    **I have nothing against people not getting a degree, I think that’s great – do whatever works for you. However, I do recall seeing many statistics stating you’d make this much more money with a degree, etc.

  9. BigDragon says:

    My Stafford loans were in the 6% range and I got through just fine. Sure, I had to opt for a state college instead of some fancy private institution. I also worked through high school and college. After graduating I went on to work at a private university for a while and was horrified at what constituted a Comp Sci degree there. It would cost 3 times as much and only provide 1/3 the amount of information I learned. Insane!

    I say let the rates go back up to the 6% range. Force the kids to go to state schools instead of taking out mountains of debt for private schools. Make them learn to get jobs in service industry to help pay for it. Throwing more cheap money at the ridiculous costs of college is not going to help bring down the cost. This is a vicious cycle that will continue to get worse the more we feed it.

    Where’s the anti-petition?

    • crispyduck13 says:

      “Force the kids to go to state schools instead of taking out mountains of debt for private schools. Make them learn to get jobs in service industry to help pay for it. “

      So where are you getting the idea that kids aren’t already doing both of those things and still graduating in debt? A state school may have dirt cheap tuition, but their on-campus living costs can be ridiculous plus all the fees they tack on for any degree that is science or medical related. Don’t get me started on campus bookstores.

      • polishhillbilly says:

        I went to a state School.(U of Arkansas) My 2 B.S. degrees (Forestry and Wildlife Management) cost me $16K for 5 years of school. No scholarships of any kind. Paid my 6% loans off in 5 years. . Apply for any and all scholarships, they are out there. Work for you Prof. in his research studies, pay and experience was in valuable in me gaining employment after graduation. Studied the affects of logging regimes on old growth bottom land hardwoods, Pittman Island, MS.

        • chizu says:

          Unfortunately a lot of in-state colleges are becoming unaffordable. The past few years I looked into the in-state tuition for my alma mater, it’d cost me roughly $20,000-$25,000 a year to get my 2-year master. It was extremely discouraging to actually try to advance. (Just double checked — $20k would be what I’ll have to pay the school, not including books. That cost only covers tuition, campus fee, and computer fee.)

          I looked into tuition for out of state students in the southwest, such as OK and KS — they are about $100 per credit more than my *in-state* (NJ) tuition. Except when I factor in boarding, I’m probably better off going to an out of state college.

          When I started college 12 years ago, tuition alone for one year was about $5,000. Including various fees, books, etc. It was probably $6,500 ish if you lived at home. It’s now about double of that. (The school estimated it about $14,000 for in-state students.) And if you include room and board, you’re looking at about $25,000 to $30,000 a year for an in-state student who lives close to campus. ($600 would probably get you a small room in a house with 6-10 other people.)

    • CommonSense(‡≤†_‡≤†) says:

      I opted for a fancy state college w/ instate tuition, not some private school that costs 4 times as much for not as good of a reputation.
      Sorry, but very, very few private schools are better than any state school.

      The federal government can do a lot of good if they stopped giving out loans for private schools. It would mean more money is left to send even more people to college.

    • jimbo831 says:

      As pointed out, you do realize that both can happen. Here is my example. Here in Pittsburgh, PA, there is one state school that offers an engineering degree: University of Pittsburgh. Tuition rates are currently around $18k per year, and expect that to increase between 5-10% next year (based on budget cuts and last year’s increases).

      So now with living expenses, you are still in huge debt and going to the cheapest school available. Sure, there are a few cheaper state schools within 2 hours of where I live, but none of them offer an engineering degree. Don’t assume the solution to every problem is so simple.

  10. Cooneymike says:

    This is just a shell game. The government has no money but that which they take from the people, primarily the wage earners. The effort to keep (costs/interest rates/loans/tuition…etc) low will involve taking money from a federal treasury that is already in a deficit. Government will spend more for this, by borrowing more for this, which it will – at some point in the future – have to tax more to cover. The result is future taxpayers, especially middle to high wage earners, having to pay for this promise.

    Most likely this means the very people being pitched this bipartisan sales gimmick, will be getting hit with the bill to pay for it (more or less) ten or so years from now when they are trying to buy a house, start a family, and do the productive things that build a society. Most likely then they will be complaining about the high taxes and the freeloaders who are taking it from the working people.

    I would scoff at the irony, except I can’t stomach the complicit nature of the polititians making these corrupt promises for their own benefit who will most likely be retired by the time the bill comes do, or will start fiddling with a new issue by then assuming (correctly) the logical chain of causation will never lead back to themselves.

    • RvLeshrac says:

      Quick, start telling us about the global financial conspiracy. Maybe we’ll be able to die of laughter before things get worse.

  11. caradrake says:

    I am starting college this summer, at my local community college.

    I am getting a Pell Grant that will cover complete tuition, books, and a few hundred extra for other expenses.

    My question is: how common is this? Can I expect to receive full Pell Grants for the entire time I am in school (looking at getting a BS or BAS from this community college). Or do they only pay completely for the first semester or two, get you hooked in?

    • crispyduck13 says:

      You should get all your questions together and make an appt with your school’s Financial Aid office. Don’t leave until they answer the questions or direct you to someone else who can. Your state’s higher education agency could also help.

      • caradrake says:

        Their answer is that it would change based on my taxes every year so they can’t give me a better answer than that.

        They weren’t able to say if people have gotten college paid for completely just through Pell Grants, which is why I’m asking here to see if anyone else has any experience.

        • crispyduck13 says:

          I remember getting Pell Grants, but it wasn’t much and I don’t remember if I had it all 5 years. If it’s strictly based on income/tax returns, then ask them for the income brackets and qualifications. That stuff is written down somewhere. Doesn’t sound like it’s limited by school year, so that’s a plus.

        • Nigerian prince looking for business partner says:

          Considering the maximum Pell Grant is ~ $5,500, I doubt there are many schools with tuition that low.

          Financial aid is so dependent on your income, where if it fluctuates at all year-to-year, it’s pretty much impossible to predict whether someone will be eligible or not in the future.

        • sponica says:

          I got some when I was in undergrad…but I went to private school, so it basically covered the cost of my room/board.

          the credit rate at my local CC is 210/credit per resident…i’m not sure what’s the standard amount of credits people take anymore…but full-timers are generally 12 credits a semester. So it would barely cover the tuition here.

    • CommonSense(‡≤†_‡≤†) says:

      I got my pell grant for all four years.
      Technically it could change if your income changes or if some kind of law is passed changing how pell grants are given out.

    • Cor Aquilonis says:

      My sister is completing her 2 year degree entirely on Pell grants this fall. They are pretty awesome – she’s moving from a crap service job to become a paralegal, and has already had some nibbles for employment.

      So, yeah, Pell grants are for real.

    • Kat says:

      You can take the Pell Grant for up to 12 semesters (6 years) with a maximum benefit of 5,500 per school year, usually dispersed 2,750 a semester.

      http://studentaid.ed.gov/PORTALSWebApp/students/english/PellGrants.jsp

      It’s also important to note that unless you are 24 or over and not claimed as a dependent on someone else’s taxes, your eligibility is generally based of your PARENTS taxes (or whoever claims you), not yours.

      It’s managed to help me a lot with school. It covered my school costs completely with a couple hundred left over. When I start at the local state university in the fall it will still cover my school costs and a good paying part time job will cover the room I’m reining from a friend.

      Good luck with school! Best way to save money? Get your book list early and buy them used off Amazon or try to find out if the prof uses them at all.

  12. castlecraver says:

    Well, for 1) you can consolidate and lock in the current consolidation rate, even if you have only one Stafford Loan. I’m fixed at 2.5% currently.

  13. damicatz says:

    1.College is not a right. You do not have a right to force someone else to pay for your education.
    2.Using government subsidies is theft. You are stealing money from the productive working members of society for your own use. You would not break into your neighbor’s house and steal their valuables to pay for college. Doing it via proxy (government taxation) is not any different.
    3.Please do not come to me looking for sympathy after majoring in [insert useless liberal arts degree] and then being unable to find a job. Woman’s studies might sound interesting but it has zero real-world value and it won’t help you get a job.
    4.Understand that you do not have to have a 4-year degree to make money or do well. There are plenty of vocational professions such as auto mechanics and nurses that can make good money.

    • Jack Doe says:

      1/10. Trying to hard.

    • ret3 says:

      1.College is not a right. You do not have a right to force someone else to pay for your education. They used to say the same thing about primary and secondary education. Society advances, the need for education increases, so it benefits everyone to make such an education accessible to all.
      2.Get off my roads, stop breathing my clean air, and don’t dare turn to my police for protection.
      3.Having an educated populace is a benefit in a democracy, as the ability to analyze information and make complex decisions is becoming ever more important to effective governance, and here in America, the people ultimately make those calls.
      4.Post-secondary education is needed for pretty much any skilled career; nursing school and mechanical instruction should be given the same sort of attention and funding as college.

    • Nobby says:

      I agree with you. ALL government subsidies should be considered theft. You did mean ALL, right?

    • pinkfish411 says:

      You seem to have an irrational animosity towards private universities. Like it or not, most of the top schools in the country happen to be private. And even if you want to go to a top public school, it may not be in your state. And what happens if somebody gets nice scholarships (which are easier to come by at private schools) that knock the total cost down in the range of an in-state public school? Why shouldn’t a person be able to go to the school that suits them best? You haven’t actually given a coherent reason to back up your position.

      And it’s not like anybody is funding a $40K/yr school with Stafford loans, anyway. There’s already a cap on the amount of government loans you can get, whether you’re at a public or a private school

    • matlock expressway says:

      “2.Using government subsidies is theft. You are stealing money from the productive working members of society for your own use.”

      So failing businesses in the farming and forestry and banking and transportation etc., etc. industries can be propped afloat by billions (if not trillions) in subsidies and tariffs and trade restrictions (which do not get repaid), but much smaller amounts in loans for students (which do have to be repaid) is theft?

      I like your logic, bizarro-conservative.

  14. CommonSense(ಠ_ಠ) says:

    3.4% is too high for interest rates. Interest rates on student loans should be under 2%.
    Also all federal student loans should be limited to state schools and in-state tuition rates.
    It is a joke they let someone get $40K loans a year for tuition, room, and board while going to a accreditied state school that has probably a better reputation only costs $15K to $20K a year for tuition, room, and board.
    Getting a degree from a private rip off school will put you into $160K in debt while a better state school will only put you in $80K in debt.
    I am sorry, but when it comes to student loans, the government should force common sense rules on students limiting the amount of loans they can get per year and also which majors they can choose.
    Why the hell you would give a loan to a history major (or any other not indemand major) at a school that costs $40K a year knowing the best they will make after graduation is like $30K a year???
    I say the lenders are more responsible than the ignorant students for bad loans thus limits must be in place.

    • Patriot says:

      State schools are only cheaper because the taxpayers foot more of the bill.

      • CommonSense(‡≤†_‡≤†) says:

        So… and your point is?

        My point is a state school charges less so you need less loans and private schools charge way more so you need much higher loans. How the state school can charge less is irrelevant to my point.

        • Patriot says:

          Well maybe if the states schools weren’t subsidized, the government could better afford loans for all.

      • sponica says:

        and some state schools are pretty expensive even for instate residents…my private school BS cost me LESS than had I stayed in state.

        and the per credit rate on my out of state tuition rate when I went to grad school in NY is still cheaper than the in state rate in NH.

  15. MrObvious says:

    cheap student loans are the cause of the tuition bubble. Stop them and tuition will come down too.

    • castlecraver says:

      Actually, the loan rates have very little to do with it. It’s the fact loans are doled out to anyone with a pulse, who “attends” any ‘ol for-profit joke of a school or dot com diploma mill. If we made people have to work just a little harder to get them, and then actually think realistically about their prospects for paying the loan back before taking it out, you probably wouldn’t have to change anything else about the program.

      • sponica says:

        the federal loans have at least “some” rules/regulations and a yearly and lifetime cap. private loans definitely used to lend to anyone with a pulse. once i got my first one co-signed, I was good to keep borrowing…

        the most stringent grant program I know is the NY TAP. that had attendance and progress requirements (if I remember my brief stint in financial aid accurately)

    • The Twilight Clone says:

      But reduced state support for higher education has induced a greater need for loans. That is the ultimate cause.

    • CommonSense(‡≤†_‡≤†) says:

      What tuition bubble???

  16. The Twilight Clone says:

    “If the interest rate on Stafford loans reverts to 6.8%, that hole could get even larger”

    Uhh…how would a higher interest rate cause the principle of those loans to grow?

    “Americans will each be paying thousands of additional dollars.”

    This is true, but it won’t suddenly make the loans bigger. That $900b figure doesn’t take interest into account.

    • sponica says:

      isn’t student loan interest capitalized every quarter? i know that’s the case on my Sallie Mae loans…

  17. atthec44 says:

    How about some legislation to lower my mortgage and auto loan interest rates to under 2%? While they’re at it, how about lowering my credit card interest rates? I wouldn’t mind anywhere under 8%.

    Also, can my DirecTV bill be capped at $50 with no loss in services? I’d also like to see my Sprint bill capped at $75 for unlimited everything on 2 lines of service and no more than a $5 upcharge when we add my daughter to the plan in a few years. As long as I’m asking, how about capping my Road Runner internet bill at $20 a month with no loss in download speed.

    When will the asking for things stop and the buying only what you can afford start?

    P.S. Can I also have my State Farm bill capped at $75 per month for auto, home and life insurance with no loss in coverage.

    • sponica says:

      because financing education is weird…it’s the only product you finance that can’t be repossessed and is given to you without a crystal ball on your ability to repay the loan.

      your home can be foreclosed, your car can be repossessed but unfortunately I can’t surrender my diploma…maybe when we invent that memory eraser thing from Men In Black.

    • trencherman says:

      I think the idea is that having an educated population benefits all of us. The interest rate on your car doesn’t make much of a difference to me, but I do want my neighbors’ kids to be educated in some fashion.

  18. ckspores says:

    I really don’t give a rat’s ass. I’m sorry I’m a selfish and hateful person but my rates are a little above 6% from grad school that I finished in 2007. So, where’s MY help? Oh yeah, nowhere.

  19. Rocket80 says:

    Not saying I’m against the rates staying low, but let’s remember that low rates (aka cheap money) are what 1) allow so many students to so easily accrue massive amounts of debt and 2) allow colleges to continue jacking up tuition.

  20. Matthew PK says:

    Ironically enough, the sleight-of-hand continues to work….
    People fail to recognize that prices are high and climbing *BECAUSE* of cheap and easy government-sponsored debt.

  21. trencherman says:

    I’m all for low student loan rates. My rate was fairly high in comparison to today’s rates (~8% at first, then ~4% later on). However, back when I graduated from grad school ~15 years ago, college was MUCH less expensive. College costs are astronomical now.

    I also think that people should be able to declare bankruptcy on their student loans. Bankruptcy does temporarily screw over your life, but that would probably be worth it to some people. Student loan corporations might also decide not to lend to people majoring in worthless degrees if they realize that students can declare bankruptcy.