President Obama sang about it with Jimmy Fallon, but it is no laughing matter.
At almost $1 Trillion dollars, it surpasses credit card and auto loan debt. The cost of an education is at an all-time high, and is set to go even higher this summer. Subsidized Stafford loan interest rates are scheduled to double– from 3.4- 6.8 percent on July 1st. It would raise costs by an average of $1,000 for each person. Dr. Linda Dagradi is the VP of enrollment management at AIC “It may be a deterrent for students in terms of their enrollment at all. It may be a deterrent for some students in the process of making an enrollment choice” she said.
It’s a choice students at AIC are very concerned about. Attendance isn’t cheap– tuition expenses, including living on campus– cost $42,000/yr. “Over half of our undergrad students are Pell grant eligible. That means they are exceptionally needy students. So anything we add to their burden becomes a disincentive” Dr. Dagradi added.
Recent college grad Hannah Hayes was able to snag a full time job at AIC, and knows the rate increase would affect her payments tremendously. “It would affect my everyday life in because I’m already paying off the maximum I could pay” Hannah shared.
Students at AIC hope the interest rates remain the same. Compiling more debt just isn’t an option. “I’m really stuck between a hard rock and a hard place because I want to continue my further education but…I can’t take out a loan because it’s going to be debt on more debt” said Senior Courtney Johnson.
Sophomore Eddie Green says it just adds to the pressure on students. “More bills when you graduate from college on top of their expenses. What it costs to go to college already right now” Green said.
Loans issued before July 1st will not be affected. Interest rates on subsidized Stafford loans and PLUS loans are also not affected. In addition to the mortgages they currently offer, wholesale giant Costco is planning on offering auto and student loans as well.