Klobuchar: Student loan interest rates could double without action

2:29 PM, Apr 19, 2012   |    comments
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WASHINGTON - Student loan interest rates could double for an estimated 200,000 Minnesota college students unless U.S. lawmakers take action quickly.

That's the warning issued Thursday by Senator Amy Klobuchar, who is co-sponsoring legislation called The Student Loan Affordability Act which would prevent the rate hike and ensure that college remains affordable. 

Klobuchar says that on July 1 interest rates on federally subsidized Stafford student loans will double from 3.4% to 6.8%, costing Minnesota students thousands of dollars in increased interest payments.

"Higher education provides students with the skills needed to be competitive in today's global economy and creates a gateway to well paying careers," Klobuchar reasons, "but rising costs for education are putting a strain on Minnesota families and students, and burdening students with thousands of dollars in additional debt is simply unacceptable."  

Subsidized Stafford loans are low-interest loans for eligible students that help cover the cost of higher education at a four-year college or university, community college, or trade and technical schools.

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