A brighter light may shine on many students who are forced to accept loans to pay for higher education.
U.S. House Democrats said Friday they plan quick action to lower interest rates for need-based student loans, in the article “Democrats propose lower interest on some student loans” on http://www.cnn.com.
The article said lawmakers have introduced a bill to cut interest rates on subsidized loans from 6.8 to 3.4 percent. The decrease would be phased in over a five-year period.
The rate decrease plan, which follows up on an election-year promise, will significantly help millions of students who have to pay for their college education through subsidized loans.
But the lower interest rate will not have any effect on students who take out unsubsidized loans or parents who take out loans to help with their kids’ college costs.
In order to offset the $6 billion cost to reduce such loans, the bill will trim subsidies the government gives lenders and reduce the guaranteed return banks get when students default on outstanding loans. Banks also would have to pay more in fees.
It is about time the government shows concern for the students who do not qualify for grants but don’t have all the money required to attend college without help. This bill sheds light on students who need that extra help with loans once they have graduated.
Thank you House Democrats.
Katrelle Simmons for the Editorial Board.