WASHINGTON, D.C.— U.S. Sen. Sherrod Brown (D-OH) today cheered Congressional passage of his legislation that will maintain lower interest rates for students using federally-subsidized Stafford loans. Without Congressional action, approximately 382,000 students across Ohio would have been forced to pay significantly more for their Stafford student loans; the rate on these loans would have doubled from 3.4 percent to 6.8 percent on July 1st. According to the Senate Health, Education, Labor, and Pensions (HELP) Committee, the higher interest rate would have added approximately $1,000 in loan debt per loan for the average student.
Brown was one of three lead Senate sponsors of the Stop the Student Loan Interest Rate Hike Act of 2012, which would have maintained the lower interest rate for one year. Legislation to maintain the interest rates on Stafford loans was included in the highway bill passed by Congress today.
“Nationally, student debt has reached about $1 trillion—exceeding credit cards and auto loans. The cost of college is continuing to rise, which is why it’s so important for the federal government to act to continue to provide students with student loan options with borrower-friendly terms,” Brown said. “Congress has done the right thing by working together—Democrats and Republicans—to extend the lower interest rate on Stafford loans.
“Excessive student loan debt means fewer of our young adults will be able to buy a home, start a business, or continue on to graduate school,” Brown said. “The last thing we should be doing is adding to their already-heavy debt load. Now we can help ensure that more middle-class Ohioans can achieve their dream of going to college.”
Last year, Brown introduced the Student Loan Simplification and Opportunity Act of 2011, legislation that would simplify the student loan repayment process. This legislation would help borrowers avoid financial penalties for missed payments, save Ohio graduates money on their student loans, and bolster the federal Pell Grant program that helped send more than 240,000 Ohio students to college from 2008-2009.