Students React To Bigger Interest Rates On Student Loans

Posted at: 07/08/2013 5:27 PM
Updated at: 07/08/2013 9:20 PM
By: Laurie Stribling

Congress is expected to take up interest rates on some student loans this week after a deadline expired last Monday.

On July 1, interest rates on subsidized student loans went from 3.4% to 6.8% and some students in the Northland are not happy with the change.

"It's really frustrating," UMD student Ben Dufault said. "I mean college students are the future of the workforce."

Dufault, along with a group of other UMD students, went out to Washington D.C. back in May to lobby against the higher rates. While the rates have increased, Financial Aid Directors at both UMD and UWS said the higher interest rates are still reasonable for students.

"It sounds like 'oh my gosh' it went up twice as much as it was before, but it has actually only been about five years that it's been this low."

Over the last five years, interest rates dropped from 6.8% to 3.4%, a number UWS Financial Aid Director Donna Dahlvang called historically low.

"The value of an education is very high compared to the cost of an education, but they need to be able to make an educated decision," Dahlvang said.

Dahlvang also said rates were even higher in the 1990's. She also mentioned the lower rate was extended last year.

Some students said they thought the increased rate would not affect enrollment.

"It's going to probably hurt later on, but I think it's worth it to invest in your education and provide yourself a better future," UWS student Andrea Yezek said.

The White House said a deal is expected to be reached by congress in time for the school year this fall.