According to this Washington Post article dated an hour or so ago, it looks like Senate leaders have come to an agreement about freezing the interest rates on student loans.
While this is better than the rates increasing as threatened, as you can see from this infographic, something is going to have to give.
The current system is clearly unsustainable.
As a grad student myself, I am quite intimidated by the nearly $30,000 in tuition I am paying a year. I can take up to $20,000 in loans; last year $8,800 was subsidized and when I graduate, I will pay 6.8% interest which is ridiculously high considering mortgage rates are lower than 4% on a 30 year loan. I decided to use an inheritance and savings to pay the rest of my tuition, for books, and other expenses. I don’t know what I will do in the coming year or how the agreement will impact graduate student loans. There are few grants and few scholarships available leaving myself and my cohort with an ungodly debt; many will graduate owing over $100,000 from grad school on top of loans of $25,000-$50,000 for their undergrad education. Most of us plan to go into low paying public sector jobs and I wonder if and when many of us will ever pay off our student loans…
Even if Congress does act by the deadline, this will do little to deal with this major economic problem facing a huge number of our college graduates. Those who don’t graduate are in an even worse situation.
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