Today, Congresswoman Laura Richardson voted to extend the current interest rate on federal student loans. The measure passed the House by a vote of 373-52 and passed the Senate by a vote of 74-19. If Congress had failed to extend the current interest rate on student loans, students who take out the maximum $23,000 in subsidized loans would have seen the amount they pay in interest increase an additional $5,200 over a 10-year repayment period and $11,300 over a 20-year repayment period.
"At a time when 7.4 million low- and middle-income students are counting on Congress to extend the current interest rate on federal student loans, I am glad that we were able to reach a bipartisan agreement that solves the immediate problem," said Congresswoman Richardson.
In the 37th Congressional District of California more than 26,000 students will benefit greatly from a lower interest rate, especially when the unemployment rate for people 20 through 24 is at a staggering 14 percent.
To address this problem, Congresswoman Richardson recently introduced the U.S LEADS Act (H.R. 5801) which provides relief for recent college graduates who are struggling to repay crushing debt while trying to find and retain gainful employment in a tough economy. Under her legislation recent college graduates who are entering a difficult job market will be able to defer payment of their federal student loans without accruing interest during periods of high unemployment.
Specifically, the US LEADS Act would automatically suspend a recent college graduate's loan repayment obligation when the national unemployment rate exceeds seven percent, or when the unemployment rate for 21 through 25 year olds exceeds nine percent.
"By extending the current interest rate, we are affirming investment in our future -- our economy depends on an educated citizenry to out-compete and out-innovate the rest of the world. Maintaining access to a quality and affordable education is vital to preserving America's status as a center for academic research and technological innovation."