2008 Woodie Awards
College loan act signed by Bush
Stephen Di Benedetto/Senior University Reporter
Issue date: 10/1/07 Section: News
Interest rates on student loans will be significantly reduced.
President George W. Bush signed the College Cost Reduction and Access Act on Sept. 27, which reduces interest rates on student loans until 2012.
Jone Zieren, director for financial aid, said the act would only help Eastern's student loan office because the federal direct program receives additional money.
Eastern operates through the federal direct program, which is operated by the federal government. The only other program in the student loan industry is the Federal Stafford Loan Program, which is operated by private lenders.
The act will cut almost $20 billion dollars in government subsides to the private loan lenders. It will also add money to the Pell Grant, which is a federal grant for low-income students attending college.
The Daily Eastern News spoke with U.S. Reps. Rahm Emanuel, Tim Walz and Zack Space via teleconference about the act.
"All of us made a priority in the last election to help middle class families, and other families who need help, to want their kids go to college and who need the resources to help their kids go to college," Emanuel said.
Emanuel, D-Ill., said this act is the largest increase in college education since the GI Bill in 1944.
Space, D-Ohio, said over the course of the next five years Pell Grants will increase by $1,400 a year. Pell Grants are currently around $4,050 and will increase to $5,400 by 2012.
Walz, D-Minn., said the Republican-controlled Congress ignored making investments in the student loan industry that would make it easier for middle class families to afford college expenses.
"They shifted the ability to get loans through the private sector that continues to profit of the backs of our students," Rep. Walz said.
Critics of this act think by cutting subsides to private lenders, private lenders will cut borrower benefits to students.
"It's all a part of the scenario that we are going to be watching," said Bill Bushaw, director for finical aid at Western Illinois University. "Whether or not the lender is squeezed so far that they have to cut upfront benefits to students."
President George W. Bush signed the College Cost Reduction and Access Act on Sept. 27, which reduces interest rates on student loans until 2012.
Jone Zieren, director for financial aid, said the act would only help Eastern's student loan office because the federal direct program receives additional money.
Eastern operates through the federal direct program, which is operated by the federal government. The only other program in the student loan industry is the Federal Stafford Loan Program, which is operated by private lenders.
The act will cut almost $20 billion dollars in government subsides to the private loan lenders. It will also add money to the Pell Grant, which is a federal grant for low-income students attending college.
The Daily Eastern News spoke with U.S. Reps. Rahm Emanuel, Tim Walz and Zack Space via teleconference about the act.
"All of us made a priority in the last election to help middle class families, and other families who need help, to want their kids go to college and who need the resources to help their kids go to college," Emanuel said.
Emanuel, D-Ill., said this act is the largest increase in college education since the GI Bill in 1944.
Space, D-Ohio, said over the course of the next five years Pell Grants will increase by $1,400 a year. Pell Grants are currently around $4,050 and will increase to $5,400 by 2012.
Walz, D-Minn., said the Republican-controlled Congress ignored making investments in the student loan industry that would make it easier for middle class families to afford college expenses.
"They shifted the ability to get loans through the private sector that continues to profit of the backs of our students," Rep. Walz said.
Critics of this act think by cutting subsides to private lenders, private lenders will cut borrower benefits to students.
"It's all a part of the scenario that we are going to be watching," said Bill Bushaw, director for finical aid at Western Illinois University. "Whether or not the lender is squeezed so far that they have to cut upfront benefits to students."
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posted 10/18/08 @ 12:59 PM CST
I believe that society would be better off if it were the government administering the loan program. They are able to get lower interest rates than private enterprises, and the government can also grant itself special powers in going after bad loans. (Continued…)
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