Congress passed a student loans bill Friday, preventing interest rates from doubling on direct Stafford loans and saving millions of dollars for many college students.
The bill, which passed in the House 373-52 and in the Senate 74-19, will keep the interest rate on direct subsidized Stafford loans at 3.4 percent. Had Congress not acted before the July 1 deadline, Stafford loan rates would have doubled to 6.8 percent.
According to the federal student aid website, direct subsidized Stafford loans are provided to undergraduate students who meet certain criteria for financial need. No interest is accumulated during the time a student is enrolled at a university.
“We have been working on this for three months in Washington, D.C.,” President F. King Alexander said. “This passage does nothing but help students and recent graduates.”
According to Cal State University Spokesman Erik Fallis, 123,000 students in the CSU will be affected by the decision. There are approximately 427,000 students in the entire CSU system, according to the CSU website.
“Our perspective on this issue is the same as it is on Pell Grants,” Fallis said. “We certainly are glad the students prevailed.”
According to Vice Provost for Planning and Budgets David Dowell, Cal State Long Beach graduates finished school with nearly the lowest debt of any college in the United States in recent years.
“It is great for students that Congress passed this law,” Dowell said. “This action by Congress will help … to prevent the national student loan debt situation from worsening.”
For students like Amanda Viselli, a sophomore accounting major, the stress of paying off her loans and obtaining a job after graduation are enough to worry about.
“It is already tough enough for us students who are taking out loans,” Viselli said. “Increasing interest rates would cause more stress about paying off loans in a reasonable amount of time.”
Ani Deswal, a junior psychology major, would have to work more hours to help pay for her loans.
“Loans are a big responsibility even if [students] don’t realize it now,” Deswal said. “If the interest rate were to increase, I would have to get a second job to try and reduce the loan amount.”
Junior mechanical engineering major Brian To, who has yet to take out a loan, said that the because of the increasing cost of school he will need to take out a loan in the future.
Even though the interest rate on direct subsidized Stafford loans will remain at 3.4 percent, it is unclear if that rate will last beyond next July.
For many, student loans are a primary way of paying for school.
“For me, student loans are a reasonable investment for a stable future,” Deswal said.