New Federal Law Could Increase Student Loan Payments
Released on = January 3, 2006, 8:25 pm
Press Release Author = TheJobHelper.com
Industry = Education
Press Release Summary = Recently passed legislation by the United States Congress
will cut billions of dollars in funding from the United States federal student loan
program. This could cost American graduates thousands of dollars in extra interest
payments.
Press Release Body = FOR IMMEDIATE RELEASE
04/01/2006
New Federal Law Could Increase Student Loan Costs
Washington, DC - Jan 04/06 - Congress recently passed new legislation in December
2005 that will cut billions of dollars in funding from the United States federal
student loan program. It has been estimated that more than $12 billion dollars could
be slashed from the program\'s budget and cause the program to make cuts. This means
that graduates will likely face increased interest rates when paying back loans.
As the new law stands, a graduate will no longer be able to lock in their interest
at a fixed rate. This is unfortunate considering the currently low interest rates we
are seeing today. As a result, graduates could expect to pay substantially more
interest over the life of the loan. For instance, an individual with a student loan
of $10,000 could expect to pay an additional $1,000 over and above the usual
interest costs.
Under the new federal law people can expect to have an interest rate of between 6.5%
- 7.0%. However, the current federal law allows people to consolidate their loans
and lock in at an interest rate below 4%. Considering that most college and
university graduates leave school with at least some debt, this could be a major
additional cost to many people. Therefore it is important for graduates to lock in
their loans now if possible, before the new law comes into affect. This could save
them thousands of dollars over the term of their loans.
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Mr. JG Cote is a resource consultant with extensive experience in the education,
employment and human resources field. He is the developer of The Job Helper website
which serves as a vast resource for job, career and employment information. To learn
more about this news release or other related topics visit his website at
www.TheJobHelper.com .
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