At a roundtable today with students and officials from Rockland Community College, Congresswoman Nita Lowey (D-Westchester/Rockland) urged Congress to act to prevent student loan rates from doubling on July 1. Congresswoman Lowey also discussed her vote against Republican legislation that could force students into loans with higher interest rates and increase student debt in the United States by $3.7 billion.
Unless the House and Senate agree to legislation in the next 30 days, interest rates on Stafford loans, the most popular type of federal student loans, will increase from 3.4% to 6.8% for students who apply for aid for the 2013-2014 school year. More than 20,000 college students in New York's 17th District currently rely on federal Stafford loans.
"Students and families deserve beAt a roundtable today with students and officials from Rockland Community College, Congresswoman Nita Lowey (D-Westchester/Rockland) urged Congress to act to prevent student loan rates from doubling on July 1. Congresswoman Lowey also discussed her vote against Republican legislation that could force students into loans with higher interest rates and increase student debt in the United States by $3.7 billion.
Unless the House and Senate agree to legislation in the next 30 days, interest rates on Stafford loans, the most popular type of federal student loans, will increase from 3.4% to 6.8% for students who apply for aid for the 2013-2014 school year. More than 20,000 college students in New York's 17th District currently rely on federal Stafford loans.
"Students and families deserve better than a bill that could force them to pay higher interest rates than they would if Congress simply did nothing and interest rates doubled," said Congresswoman Lowey. "With total student debt currently at $1.1 trillion, we need legislation that keeps loans affordable, not legislation that increases student loan debt. We are running out of time to prevent these increases that would make college more expensive."
Last week, House Republicans passed H.R. 1911, under which student loan interest rates would change year-to-year by calculating the 10-year Treasury note interest rate average plus an additional 2.5%. Because the current 10-year Treasury note rate is approximately 2.13%, new loans would increase to 4.63% based on this calculation, well above the current 3.4%. According to the Congressional Budget Office, the bill would increase interest rates by $3.7 billion over the next decade. Under the GOP bill, students who borrow the maximum amount of subsidized and unsubsidized Stafford loans over five years could pay nearly $2,000 more in interest costs than if interest rates doubled to 6.8% on July 1. Congresswoman Lowey opposed the legislation because she believes we must maintain -- or even lower -- the current interest rate for student loans.
Congresswoman Lowey has cosponsored two pieces of legislation that would prevent interest rates on federal student loans from rising. One bill would lock in place the current interest rate of 3.4% on subsidized Stafford loans for the next two years. Lowey has also cosponsored legislation that would allow students to obtain federal loans at the same rates the Federal Reserve provides to banks, which can be as low as 0.75%.
As the senior Democrat on the House Appropriations Committee, Congresswoman Lowey has fought to increase the maximum Pell Grant award. A total of 21,108 students at colleges and universities in Westchester and Rockland annually receive Pell grants worth up to $5,500.
tter than a bill that could force them to pay higher interest rates than they would if Congress simply did nothing and interest rates doubled," said Congresswoman Lowey. "With total student debt currently at $1.1 trillion, we need legislation that keeps loans affordable, not legislation that increases student loan debt. We are running out of time to prevent these increases that would make college more expensive."
Last week, House Republicans passed H.R. 1911, under which student loan interest rates would change year-to-year by calculating the 10-year Treasury note interest rate average plus an additional 2.5%. Because the current 10-year Treasury note rate is approximately 2.13%, new loans would increase to 4.63% based on this calculation, well above the current 3.4%. According to the Congressional Budget Office, the bill would increase interest rates by $3.7 billion over the next decade. Under the GOP bill, students who borrow the maximum amount of subsidized and unsubsidized Stafford loans over five years could pay nearly $2,000 more in interest costs than if interest rates doubled to 6.8% on July 1. Congresswoman Lowey opposed the legislation because she believes we must maintain -- or even lower -- the current interest rate for student loans.
Congresswoman Lowey has cosponsored two pieces of legislation that would prevent interest rates on federal student loans from rising. One bill would lock in place the current interest rate of 3.4% on subsidized Stafford loans for the next two years. Lowey has also cosponsored legislation that would allow students to obtain federal loans at the same rates the Federal Reserve provides to banks, which can be as low as 0.75%.
As the senior Democrat on the House Appropriations Committee, Congresswoman Lowey has fought to increase the maximum Pell Grant award. A total of 21,108 students at colleges and universities in Westchester and Rockland annually receive Pell grants worth up to $5,500.