The 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:
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?
I think that is ridiculous! How on earth is the interest 110k on 90k??
That being said, I went to a cheap college that I paid for on my own as i went. Why on earth do you need a 90k college? It sounds a bit extravagant. I mean, how long would you have to work to pay that off?!?! It's not like you get a job paying $100k a year and have no bills, just your college tuition.
What kind of example does it set to show kids it's ok to have that kind of debt before they even get a job??
by Dawn07May 8, 2012 at 10:20 AM
They want the American people to 'better' their lives, but at such a cost. We live paycheck to paycheck and neither of us have been to college. I can't imagine each of us having student loans. This is what is keeping both of us from even trying to go back to school.
May 8, 2012 at 10:22 AM
While I don't have a problem with businesses - even banks - making a profit, I do think it's an unwise practice that shows little foresight to slam people with usurious interest rates before they've even begun to make the money that runs the nation.
I was fortunate in that my mom paid for my first degree, but I paid for the second one. I worked nearly full time and carried almost a full load of classes, plus my scholarship requirements. It was at a state school, so it wasn't on any awesome lists, but it did the job and I learned a lot.
May 8, 2012 at 12:06 PM
I am in the middle.. I hold student loans and I dont want or need the rates to go up. On the other hand I dont believe other people should have to pay for my rates to stay the same.
by usmom3May 8, 2012 at 1:10 PM
I think it is ridiculous to go into such debt so you can basically be an indentured servant to the banks for the rest of your life! Most people don't even go in to the fields related to their degrees because they can't find a job that will pay them enough to pay the debt & be able to live!