The June Fight Over Student Loans
Today (Friday) President Obama will join college students at a White House event launching a new push to keep student loan rates from doubling in July. Among the various plans offered Sen. Elizabeth Warren’s plan is the most affordable for students, while the Repubican plan tries to “make money” off of students using fluctuating “market rates.”
Student Loan Rates Set To Double
Student loan rates for more than 7.4 million students with federal “Stafford loans” are scheduled to double July 1 from 3.4% to 6.8% if nothing is done. The amount of student loan debt is massive. US students currently owe almost $1.1 trillion in student loan debt, and this amount is increasing at a rate of about $2,853.88 per second. This amount is greater than total credit card debt currently owed. 35% of people under 30 are near default on their student loans, and approx. 32% of those age 30-49.
In 2005 average student loan debt was just over $17,000. By 2012 it was above $27,250. This was a 58% increase in just seven years. This debt creates a drag on the U.S. economy — home ownership and car ownership have declined for young households.
This infographic shows the extent of the problem: (click for larger)
There are various plans before the Congress to avoid the July 1 rate-doubling. But
