University at Albany senior Kevin Fox on Monday, July 1, stresses the burden on students and families of federally subsidized Stafford loans facing an increased interest rate of 6.8 percent.
Photo by John Purcell.
continued The nonpartisan Congressional Budget Office said the House GOP’s student loan bill would eventually cause interest rates to settle at around 7.7 percent. Tonko said the additional burden of around $2,000 over the lifetime of a student loan was unacceptable.
Fox, a 24-year-old, said he opposed the House GOP plan, and also rebuked Congress for potentially allowing the interest rates to increase because of inaction.
“It is almost unthinkable to me that Congress would double the interest rate at a time like this when the economy is doing so poorly and make it that much harder for students to start their lives when they get out of college,” Fox said.
Tonko said the issue has received “a lot of scrutiny” and hoped lawmakers would agree to the proposed two-year extension.
Besides paying higher interest rates, Tonko said another negative effect could be an influence on students to choose a different major.
Though loans did not affect her career choice, UAlbany senior Jen White, of Bethlehem, said they could affect her going on to graduate school.
“I may choose to not go because I am too afraid to be saddled with the loans and the debt,” White said.
White said she went to a private college her first year, but transferred to Albany for the value it offered.
“I am still going to be in debt here … but you really have to look at the value of an education nowadays,” she said. “A rise of interest rates is just outrageous in this economy.”
White said fellow students do stress about paying off student loans, and some wonder if they’ll even find a job within six months of graduation, when the first check is due. Her two sisters are attending private colleges.
“Money needs to be made, but this is the incorrect way to do it,” she said. “To think that it will be more stressful is frightening.”