The U.S. Congress voted June 29, only two days before its July 1 deadline, to extend the current interest rate on Stafford student loans for another year.
The Senate voted 74-19 and the House voted 373-52 in favor of keeping the 3.4 percent rate from doubling to 6.8 percent. The issue will be raised again by July 1, 2013, under identical circumstances.
“We have been preparing for an interest rate hike for the past five years,” MU Student Financial Aid director Nick Prewett said. “I do not believe that it has any effect on our (office’s) operations.”
Last year, 9,978 MU undergraduate students were granted subsidized loans at an interest rate of 3.8 percent, totaling $40,514,675.
“College affordability is a growing problem,” Prewett said. “Students are facing great difficulty attending higher education institutions if they do not have parental support.”
The Office of Student Financial Aid often listens to student’s concerns, Prewett also said.
“We have communicated to the students who are concerned about the interest rate going up,” he said.
Some students, including freshman Kenzie Tysl, were closely watching action on the issue.
“I’m relieved,” Tysl said. “It is less money that I’ll have to pay. It took a pretty substantial weight off of my shoulders.”
Tysl is paying for her education at MU primarily through a mixture of subsidized Stafford Loans and unsubsidized loans.
“I was already worried about having to pay everything back, and now with all of the changing back-and-forth in Congress, I am worried how it will be four years from now,” she said.
Many MU students as well as millions of students and graduates across the United States find themselves in the same positions as Tysl, with Americans owing more in student loans than credit card debt for the first time in U.S. history, according to FinAid, a financial aid information website.
“A wave of student and borrower mobilization changed the political calculus, confirming that college affordability is a key concern for young people, their families and anyone who cares about the U.S. having a high-skill, competitive economy,” Rich Williams of the U.S. Federations for Public Interest Research Groups said in a press release. “(This) victory is another important step in getting rising student loan debt under control.”
In the past months, many students and communities around the country expressed their concerns with and disapproval of the looming interest rate deadline. Even the White House got involved by encouraging upset students to mobilize in a movement called “Don’t Double My Rate!”
“Students can now rejoice in knowing that all of their hard work paid off,” Williams said in the release.
