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Act lowers, fixes student loan interest rate
Nevada Daily Mail
As the school year approaches, college students line up to buy books, finalize their schedules and may consider taking out a loan.
The good news is the interest rates for those loans won't be jumping to 6.8 percent. The Bipartisan Student Loan Certainty Act of 2013 sets the rate on Direct Unsubsidized Stafford loans at the rate on high-yield 10-year Treasury notes, which is 3.6 percent, and caps that rate at 9.5 percent. It sets the rate on Direct PLUS loans at 4.6 percent, and caps that rate at 10.5 percent. The rates will be fixed for the period of the loans.
Donna Thomas, Crowder Director of Financial Aid, said lowering the rate is a good move.
Thomas estimated a third of Crowder's students, at most 150, take out student loans.
"We want students to keep borrowing under control," she said. "We don't want students defaulting or borrowing more than they need."
Lacie Schnedler of Nevada, who is attending Crowder to become a nurse, took out a loan last year and plans to again this year.
"I think (the) lower rate is a very good deal because they really do help you to get through college and deal with financial situations that come up," she said. "For the interest to be lower, it seems like less of a burden whenever you finish."
Austin Buttorff of Schell City said the lower rate isn't going to convince him to get a loan.
"I'm not going to get a student loan because I don't want to be in debt," he said.
Julie Moore of Rockville, is a student worker in Crowder's bookstore and has been attending Crowder for nearly four years.
"I'm glad that the interest rates went down," Moore said. "The longer you're here and the more schooling you get, it seems like the less money you get. Those of us who've been here awhile, you start (to) go into the Stafford loans. We need more money to finish out our schooling. I don't get the loan yet, but there's coming a time pretty soon that I'm going to have to get it."
Last year, 973 students took out a total of $4.6 million in loans at Fort Scott Community College.
Lillie Grubb, FSCC Director of Financial Aid, said a lower rate is good for anybody.
"We're always interested in what's best for our students," Grubb said. "We make sure to counsel students about when they have to pay back and their rights and responsibilities. Tax payers fuel public education. We want to be good stewards."
More than 50 percent of Missouri Southern State University's students use the loans, that's more than 3,000 students.
Becca Diskin, MSSU Director of Financial Aid, said anything that helps students is better.
Senator Roy Blunt applauded the passage of the act, which he co-sponsored.
"I'm glad members on both sides of the aisle were able to work together to reach this bipartisan solution and finally give students more long-term certainty and access to lower rates," Blunt said in a press statement.
Representative Vicky Hartzler said she thinks the act is a good solution to help lower rates.
"As a former teacher, I'm very glad to support this effort to lower the cost for education."
State Representative Ed Emery said while having a low rate is common sense, he is concerned about the government manipulating rates.
"Artificially manipulated rates by government give an artificial sense of security," Emery said. "In the short term, students are happy. In the long term, artificial rates put pressure on the whole economy. The cost isn't going away."
Elizabeth Basham of Nevada, who attends Crowder, said she thinks student loans can get borrowers in trouble if they don't know what they're doing. "But, I think the lower rate will help out a lot of people, especially those who have tried out for the Pell Grant and can't get it," she said.