Student Loans Need Urgent Reforms

Student loans, can not live with them, can not live without them. We have a problem in congress where the rates will rise to 6.8 percent indefinitely without congressional action by the end of the month. Basically the cost of borrowing is going to double from the previous rate of 3.4 percent.

First, due to deficit reduction the subsidized graduate student loans were eliminated. So for myself personally I will have to pay interest on these loans while I am in school for the next year and a half in my program. I think there should be a compromise where student loan interest is at a partial percentage until graduation or when a student’s program ends due to withdrawal. Partial subsidy would be better than no subsidy at all.

Second, due to the Republicans dominating in congress asking for the full rate reduction is not likely. I was proposing that we should go halfway at 5.1 percent. If you borrow 10,000, you would be saving around 14 dollars a month in interest payments. If we want to be austere yet still give students relief the 5.1 percent rate could be a repayment incentive for 12 on time payments in a row.

Third, participate on Twitter with President Obama’s hash tag #dontdoublemyrate, call your congressional representatives in the US Senate and Congress and if you do not like your incumbent congress member ask the candidates running against them their opinions too.

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