National crisis in student debt
Taylon Terrell
Issue date: 10/25/07 Section: Forum
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When I graduate, I will have $6,000 in student debt. Many people do not end up as lucky. The total amount of student debt in the U.S. is up to $440 billion. The average debt for student loans has increased 50 percent in the last decade. Even though the average graduate owes $19,000 by the time of graduation, many undergraduates owe more than $40,000. If I had not been so fortunate as to receive in-state tuition, I too would be up to my armpits in student loans.
Private loan lenders such as Sallie Mae have high interest rates and have few borrower protections. Also, Investigations by attorney generals and advocacy groups have revealed a pattern of conflicts of interest with financial aid offices in certain schools. Apparently, Sallie Mae and other lenders cultivate strong relationships with schools and financial aid officers. Students and their families are often misguided by financial aid offices due to inappropriate lender influence. As Congress strives to increase access to higher education, private loan lenders such as Sallie Mae work hard to influence lawmakers, and colleges and universities not to endorse these bills.
In recent news, Congress passed the College Cost Reduction and Access Act on Sept. 7, 2007 by a vote of 79-12 in the Senate and 292-97 in the House of Representatives. It is expected that the bill will be signed into law by President Bush in the coming weeks. In addition to cutting student loan interest rates in half, the bill will increase grant aid for low income students and help make student loan debt more manageable by cutting excessive subsidies to student loan companies. The legislation will also expand loan forgiveness programs for critical public service careers.
How ironic that Sallie Mae lined up to oppose this legislation.
The very lender that boasts to "help millions of Americans achieve their dream of a higher education" also tried to protect the billions of dollars in federal subsidies that make them some of the most profitable companies in America. This is why they need the relationships they have with schools. So, they will continue to feed students lies about the lender they prefer rather than the one that would offer us the least amount of debt. It is for reasons such as this that I believe our schools have misguided students, and driven them to become what some call "generation debt."
Private loan lenders such as Sallie Mae have high interest rates and have few borrower protections. Also, Investigations by attorney generals and advocacy groups have revealed a pattern of conflicts of interest with financial aid offices in certain schools. Apparently, Sallie Mae and other lenders cultivate strong relationships with schools and financial aid officers. Students and their families are often misguided by financial aid offices due to inappropriate lender influence. As Congress strives to increase access to higher education, private loan lenders such as Sallie Mae work hard to influence lawmakers, and colleges and universities not to endorse these bills.
In recent news, Congress passed the College Cost Reduction and Access Act on Sept. 7, 2007 by a vote of 79-12 in the Senate and 292-97 in the House of Representatives. It is expected that the bill will be signed into law by President Bush in the coming weeks. In addition to cutting student loan interest rates in half, the bill will increase grant aid for low income students and help make student loan debt more manageable by cutting excessive subsidies to student loan companies. The legislation will also expand loan forgiveness programs for critical public service careers.
How ironic that Sallie Mae lined up to oppose this legislation.
The very lender that boasts to "help millions of Americans achieve their dream of a higher education" also tried to protect the billions of dollars in federal subsidies that make them some of the most profitable companies in America. This is why they need the relationships they have with schools. So, they will continue to feed students lies about the lender they prefer rather than the one that would offer us the least amount of debt. It is for reasons such as this that I believe our schools have misguided students, and driven them to become what some call "generation debt."
