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Posted by on May. 7, 2012 at 2:05 PM
  • 5 Replies

What Do You Think About the Student Loan Interest Rate?

Posted by Lindsay Ferrier

Vector PortalThe Senate is expected to vote tomorrow on whether to debate a plan from the Democrats that would keep college loan interest rates on Stafford loans from doubling two months from now. The bill would be financed by raising payroll taxes on certain qualifying taxpayers that make a lot of money.

Meanwhile, Republicans have their own plan to keep the interest rate from doubling, to be financed by removing a preventive program from President Obama's health care reform plan.

As usual, both sides are at an impasse- and if they can't come to an agreement, the interest rate will double on July first.

That's why we're asking our political bloggers the following question this week:  Should federal student loan interest rates be raised or lowered? Why? What do these rates mean for your child's college education? How do you anticipate paying for your child's education?


I can't help but think of a Moms Matter video about a mom named Chantal, whose family is essentially crippled by their student loan debt. Check it out:

VIDEO HERE

Chantal's husband owes $90,000 in student loans. With interest, though, they owe $200,000. Their monthly student loan payment is the equivalent of a mortgage payment, and for that reason, their family of five is living paycheck to paycheck -- AND living with Chantal's in-laws.

To me, this is unacceptable. By all rights, Chantal's family should be doing fine and able to afford their own modest home. And Chantal is hardly alone. Nationwide, student loan debt now exceeds Americans' credit card debt. When student loan debt is responsible for crippling families, it's a BIG problem that affects all of us.

Expect Democrats and Republicans to come to an agreement before July first -- After all, no one wants interest rates to double.

And in the meantime, if you want to read more on the subject, the AP has a great "Student Loans 101" post that explains the issue in detail. I highly recommend that you check it out.

What do you think about the student loan debt issue? Are student loans affecting you or your family?

 

by on May. 7, 2012 at 2:05 PM
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Replies (1-5):
Why123
by Nancy on May. 7, 2012 at 2:18 PM

I am paying on my student loans.  That's one of the reasons I haven't finished my bachelors.  My granddaughter will be in deep debt by the time she finishes her education.  Aren't things in this country bad enough without making it worse on the people who will be our future?  I can't see raising interest rates so some bank can make a profit.

CoeyG
by on May. 7, 2012 at 5:05 PM

Nope my daughter paid off her student loan last year before she was out of school

suzeebloch
by Ronna on May. 7, 2012 at 9:55 PM

i'm not sure how Johnny got off without very many student loans at all.  He saved his $$ working part-time in high school and paid the nonresident tuition at a community college his first year in California.  2nd year, he was granted resident status and that year was minimal. In fact I only had to send him $500 a month back then.  because he had surplus in grants/scholarships.  lol.  3rd year he transferred to UC Davis and in addition to the tuition there is a $22,000 out of state fee.  However, between his scholarships, grants and the federal loan (which I think is $5500), he has that $22,000 whittled down to only $15000.  I cashed out an IRA to fund that last year and Grandma is paying it this, his senior year.  Not counting the out-of-state fee, he only has $11000 in student loans, if I'm not mistaken.  I am not asking him to pay back my $15000.  Grandma already told him that he doesn't have to pay her back, either. 

I'm curious to know how people are amassing these huge student loans ...

hugss
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by on May. 8, 2012 at 9:13 AM

It's awful :(
My youngest has started his Master's & has school loan debt .. I hate that for him ::sigh:::
I don't know how he will ever pay it all back.
Doubling it will make our younger generation wondering if they should go to college ::sigh::

homeskoolmama
by on May. 8, 2012 at 2:03 PM

Loan rates are crazy. If Jesse pays his loan off on schedule it will take him 10 years to pay off $8600  think of the interest! wow, he will start paying on it next month when he gets his first check instead of waiting until Sept.

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