Fresno Democratic Rep. Jim Costa is calling on Congress to take swift action to reset student loan rates to 3.4%.
Costa, who spoke to news media Friday in downtown Fresno surrounded by students from Central Valley universities and community colleges, said lowering the interest rate that doubled to 6.8% in early July is critical for low-income students looking to get college degrees.
“We cannot keep setting our students up for these interest loan cliffs every year,” he said. “Congress must act and we must act sooner rather than later.”
Congress failed to act before a July 1 deadline on a plan to prevent interest on Subsidized Stafford loans, which account for roughly a quarter of all direct federal borrowing, from jumping to 6.8%.
Legislators have since attempted but failed to reach resolve the issue. A recent deal in the Senate flopped Thursday after lawmakers learned the tentative plan could cost $22 billion.
Michael Ybarra, a 20-year-old Fresno City College graduate headed to the University of California at Berkeley next year, urged lawmakers Friday to reach a deal before school resumes in the fall.
Ybarra said he’s taken out about $7,000 in loans over the past two years. He plans to take out an additional $15,000 in loans to attend Berkeley, he said, and hasn't yet been able to repay any of it back.
“I come from a working-class family and rely heavily on financial aid as well as student loans to mediate those costs,” he said. “I’m really concerned with the debt; not only for the families, but the students, that the interest rate is very large.”
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