While federal student loan interest rates are certainly way too high, whatever happens on July 1 will not be bad news for graduate students. If interest rates double, it will be on a certain type of loan – the subsidized loan for undergraduates only. Graduate students already pay the 6.8 percent interest rate. The subsidized loan was taken away from graduate students a year ago. Undergrads pay 3.4 percent, which is scheduled to go to 6.8 percent automatically on July 1 if Congress doesn’t act.
“The good news is that student loan interest rates are on everyone’s radar screen – finally!” said Susan Howard, AUNE director of financial aid. “How interest rates are determined on all student loans needs to be reevaluated. Graduate students stand to benefit from whatever Congress ultimately does for the long term.”
Howard suggested contacting your Congressional representatives to urge them to lower interest rates for ALL students. Tell them your own story of how much you rely on student loans to finance your education. Urge them to continue supporting programs that assist students when they are repaying their loans – Income Based Repayment, Pay as You Earn, and Public Service Loan Forgiveness.