After college acceptance, next challenge for many is paying tuition
Published: August 24, 2012
WASHINGTON (CNS) -- After finally being accepted into college, the only headaches left for students are how to fit a dorm room into a car for move-in day -- and how to afford that tuition. On June 29, Congress voted to keep the interest rate for Stafford federal student loans at 3.4 percent; it would have automatically doubled July 1, jeopardizing the ability of many graduates to afford the loans. The action came after months of speculation that lawmakers would not be able to reach a compromise. The bill keeping the interest at the current level for the next year was packaged with $100 billion in federal highway funding and a five-year reauthorization of national flood insurance. President Barack Obama praised the vote as necessary for keeping the American workforce educated and competitive. Signing the measure July 6, he said: "In today's economy, a higher education is the surest path to finding a good job and earning a good salary and making it into the middle class." Both political parties agreed on the importance of tuition relief, as collective student debt hit the $1 trillion mark this year, much earlier than expected, according to the Consumer Financial Protection Bureau. The interest rate is now set to double July 1, 2013. Undergraduates whose families show financial can get a Stafford loan. Graduate students have been unable to get subsidized student loans since the Budget Control Act of 2011 made them ineligible. In addition, lawmakers eliminated the six-month grace period after graduation, during which students were not obligated to pay interest on their loan. If students are unable to cover the interest, because they are still looking for work, that could damage their credit score.
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