Thousands of students across Iowa are embarking on a new chapter in life after graduating from college this month. The unfortunate reality they now face is finding a job and repaying student loans which are becoming more costly.
Students in the 2013 graduating class with federally subsidized loans will be able to repay them at a low interest rate of just 3-percent. But for those furthering their education, those rates are about to double, to over 6-percent on loans taken out after July 1st.
“It’s a pretty scary thing, especially considering how quickly we have to pay student loans after graduation. So not only do you have to worry about finding a job right away, but also paying the loans right away,” said Wartburg student Kyle Scobee.
Scobee had the smarts to start saving money, but he knows his concerns are shared by a lot of students, all who are hoping Congress acts to avoid the loan rate spike.
“We want our students to be educated, to pursue education. If we get heftier student loan payments, it’s going to stop students from going to college, and we want to keep pursuing education and bettering ourselves. So if we can do anything to continue that growth, we definitely want to keep doing it,” Scobee said.
A vote on the first bill to prevent student loan interest rates from rising failed to pass in the U.S. House last week, but talks of a compromise deal are ongoing.
The very same issue came up during the ‘debt ceiling’ debate last summer, but a last minute deal prevented them from doubling.
Thanks to our affiliate station KWWL for this story.