Posted 4:00 PM 6/4/2013 : How Congress' student loan bill would hit UA students
TUCSON - College students and their families are watching the U.S. Senate closely this week. Lawmakers are set to vote on a student loan bill that would extend the current low interest rate on subsidized loans for another two years. If they cannot reach an agreement by July 1, the rate will go from 3.4 percent to 6.8 percent.
About 14,000 University of Arizona students use subsidized loans to fund their education and the price of an education is getting higher every year.
"We have no money now, we're going to have even less money once we leave and try to start our careers," said Tyler Gastelum, an incoming sophomore at the University of Arizona.
"We're rolling the dice essentially, four years later to come out with $40,000 in debt or so and hoping that this degree is going to get us a job that we can use to pay those bills back," said UA Student Bridgette Pena.
Those bills could climb even higher if Congress does not act soon.
"We are concerned, we're watching that very closely," said Associate VP for Student Affairs and Enrollment Management Kasey Urquidez. "We don't want students to have to pay more than what is absolutely necessary."
Every situation is unique so the numbers will vary from student to student. However, the Project on Student Loan Debt said the UA class of 2011 had an average debt of $21,000. Consider the student is in school for four years, is graduating soon and has a 10-year loan term.
News 4 Tucson's Danielle Lerner plugged those numbers into an online loan calculator at FinAid.org and found that with a 3.4 percent interest rate, the student pays $24,801 over the life of the loan. If that rate doubles to 6.8 percent, the total payout jumps to $29,000. That is just under $4,200 extra.
"I think they should do whatever they can to stop that from happening because we can't afford more money," said Gastelum.
Right now there are several options on the table but the University of Arizona says it is hoping for a two-year extension.
"That gives others in Congress some time to really think about what this impact might mean, and where we go for a permanent solution," said Urquidez.
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