Bingaman Applauds Senate Passage of Bill that will Help Make Student Loans Possible

Press Release

Bingaman Applauds Senate Passage of Bill that will Help Make Student Loans Possible

U.S. Senator Jeff Bingaman today applauded Senate passage of legislation aimed at making sure college loans remain available to students at a time when the credit market has been hurt by the nation's housing crisis.

The Senate adopted by unanimous consent the Ensuring Continued Access to Student Loans Act of 2008, which helps give student lenders access to capital to make new loans. Funding for student loans is drying up because investors are balking at putting up the capital, out of fear of losing money. The bill gives the Secretary of Education the temporary authority to purchase loans from lenders in the federal guaranteed loan program if there are no other purchasers.

The measure will reduce reliance on costly private college loans because it increases the annual loan limits on federal unsubsidized student loans by $2,000, and increases the aggregate loan limits to $31,000 for dependent undergraduates and to $57,500 for independent undergraduates. It also gives parent borrowers of PLUS loans the option to defer loan principal repayment for up to six months. And it helps struggling homeowners pay for college by ensuring parents that are delinquent on their mortgage payments as a result of the current mortgage crisis are not disqualified from accessing PLUS loans.

"Families across the country are already struggling, and we cannot allow that to affect a young person's ability to attend college. This very important piece of legislation will help ensure that student loans will be available to students who need them," Bingaman said.

A version of the Ensuring Continued Access to Student Loans Act of 2008 already passed the House of Representatives, but the Senate made modifications which require a second vote in that chamber.

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