|Congress halts rise of loan rates|
|Written by Elizabeth Brei, Daily Vidette Senior Staff|
|Tuesday, 10 July 2012 18:01|
The U.S. Congress passed a bill in June to prevent federal student loan rates from rising.
Student loan interest rates were set to double from 3.4 percent to 6.8 percent on July 1.
The Congress passed the measure with a 74-19 vote from the Senate and a 373-52 vote from the House.
Jana Albrecht, director of financial aid at ISU, said that the rise in interest for student loans would mean the loans would be more expensive.
"Students would end up paying more in interest over the lifetime of the loan," she explained.
If the bill had not passed, the rise in interest rates would have meant a $1,000 increase in average costs for loans.
Albrecht explained that most students borrow about $20,000 in student loans throughout their college careers.
If students could not make the payments, most universities would not be able to offer enough scholarships to give to prospective students in need.
"The University could not afford to replace all student loans with scholarships," Albrecht said about ISU.
Since the federal loan interest rates did not rise, students might find the prospect of federal loans more manageable, instead of seeking out private loans, which could have higher interest rates and be more difficult to pay off.