Congressman Young’s College Plan Would Double Student Interest Rates

INDIANAPOLIS – While too many students across the country are drowning in student loan debt, Congressman Todd Young would double student loan interest rates and make it even harder for Hoosier students to pay off their loans.

Congressman Young helped draft a plan that would have doubled student loan interest rates from 3.4% to 6.8%. So what does that mean in real dollars for Hoosiers paying for college? Indiana students graduate with an average of $29,229 in student loan debt. Loan rates jumping from 3.4% to 6.8% would mean the average Hoosier student’s cumulative payment would increase by $5,842.78.

That’s more than a semester’s worth of tuition at IU, Purdue, Indiana State, or Ball State.  

Asking students to pay $5,842.78 more than what they already owe is not a solution, it exacerbates the problem, and no Hoosier is safe from the fallout of Congressman Young’s political ambition.

“Congressman Young has proven once again to be dangerously out of touch with the needs of Hoosiers. The one thing Hoosier students don’t need is more loan debt, but that’s exactly what they’d get with Todd Young as their senator,” said John Zody, Chairman. “By voting to double student loan interest rates, Congressman Young has demonstrated that he cares more about his approval among D.C. special interests than the concerns of Hoosier college students. Hoosiers can’t risk allowing Todd Young’s political agenda to reach the U.S. Senate.”

“Congressman Young’s plan for Hoosier students like me is reckless,” said Michael Turinetti, a student at Purdue University. “It would mean more years of paying off my student loans, and more time before I could purchase a home or go after my dream job. College students can’t afford Todd Young’s dangerous plan.”

BACKGROUND INFORMATION:

YOUNG’S PLAN WOULD DOUBLE STUDENT LOAN INTEREST RATES…

Jasper Herald: Young “Helped To Draft” The House GOP Budget. “The House’s proposed budget, which Young helped to draft as a member of the House Budget Committee, proposes changes to those programs, such as turning the Medicaid program over to the states, which he said many governors are requesting, ‘and allowing them to find the most effective way of controlling costs.’” [Jasper Herald, 4/27/11]

  • Ryan Budget Would Have Allowed Student Loan Interest Rates To Double From 3.4 Percent To 6.8 Percent.“[T]he Ryan plan […] would allow student loan interest rates on new Stafford loans to double this July, from 3.4 percent to 6.8 percent.” [Education Votes, 3/20/13]
  • Ryan Budget Proposed Returning To Unsubsidized Federal Student Loans, Which Would Cause Interest Rates To Double.“3.4 percent (the government’s current subsidized interest rate for Stafford loans, which were established in 2007 and will expire in July if not renewed) versus 6.8 percent (the unsubsidized interest rate to which the Ryan budget proposed returning those loans). [New Republic,4/27/12]

…WHICH COULD HAVE INCREASED HOOSIER STUDENT DEBT PAYMENTS BY NEARLY $6,000

The Average Indiana Student Owed $29,229 In Student Loan Debt. [The Institute For College Access & Success, Accessed 8/16/16]

An Increase In Loan Rates From 3.4 Percent To 6.8 Percent Would Result In An Increase In Cumulative Payment For Hoosier Students Of $5,842.78. [The Institute For College Access & Success, Accessed 8/16/16]

  • A $29,222 Loan Repaid Over 10 Years At A 6.8 Percent Interest Rate Would Result In A Total Cumulative Payment Of $40,354.41.According to org, a loan balance of $29,222 repaid over 10 years at a 6.8 percent interest rate would result in a total cumulative payment of $40,354.41. [FinAid.org, Loan Calculator, Accessed 9/10/16]
  • A $29,222 Loan Repaid Over 10 Years At A 3.4 Percent Interest Rate Would Result In A Total Cumulative Payment Of $34,511.63.According to org, a loan balance of $29,222 repaid over 10 years at a 3.4 percent interest rate would result in a total cumulative payment of $ 34,511.63. [FinAid.org, Loan Calculator, Accessed 9/10/16]

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