The difficulty in finding employment makes it challenging to pay back student loans, and it may get even harder.
Interest rates on Stafford loans are set to double from 3.4% to 6.8% as of July 1st unless lawmakers can agree on a plan.
“The solution here is do something that makes sense for everyone rather than play politics with it. That’s where we need to go and that’s what I’m hoping,” said Darlene Senger, an Illinois State Representative.
Democrats hoped to freeze rates for the next two years whereas the Republicans proposed a market-based interest rate system. Both plans were voted down.
One Republican bill voted through the house still remains in play a variable rate plan that would cap interest rates at 8.5%.
Also on the table, President Obama’s plan, which is market-based but keeps borrowing rates fixed for the life of the loan.
The decision will affect approximately 7.4 million graduates paying back student loans. One of which is Brandt Bechard. His rate is currently 6.8%.
“As college students we already don’t have that much money to begin with and it’s really hard to find a job in your chosen field right out of college,” said Bechard, a WyoTech graduate.
Subsidized Stafford loans are need-based for undergraduate students and are determined by their Free Application for Federal Student Aid or FAFSA form.
Student loans do not accumulate interest while in college and do not have to be paid back until six months post graduation.
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