Campus leaders across the nation are urging Congress to come up with a long-term solution for student loan interest rates.

If Congress does not create a new plan by Monday, interest rates on subsidized Stafford student loans will double, from 3.4 percent to 6.8 percent, according to an issue brief from the Arizona Public Interest Research Group.

This is not the first time students have seen a crisis regarding student loan interest rates. In 2012, President Barack Obama and Congress extended the 3.4 percent rate for one more year, after a 2007 college affordability plan expired.

If the low interest rate is not extended, students will see an approximate $902 increase in their student loan debt, per loan, according to a news release from Arizona PIRG. Despite the increase in debt, the federal government is projected to profit $50 billion in revenue from the 2013-14 Stafford student loan program by collecting 12.5 cents for each dollar loaned.

“Congress has got to get off their you-know-what, and do something,” said Kaiser Adeni, a father of two college students, one of whom will be studying business at the UA this fall. If nothing is done, Adeni said the increase will definitely affect his finances.

Katie Boswell, an anthropology senior, said she currently has one subsidized student loan, but is planning to take out another in order to finish her education.

For Boswell, it is both stressful and a huge inconvenience.

“For me it just means saving that much more,” Boswell said. “It means pushing back financial plans that you would’ve had, you know? Like if you were planning on getting your first car, or going in on your first big investment … it’s almost like having child support or a mortgage when you’re right out of college.”

Last week, more than 100 campus leaders signed a petition requesting Congress seek a long-term solution. Among them were student body presidents from Northern Arizona University, Arizona State University and the UA.

“As student body president, this is probably the number one issue that’s going to universally affect every single student at the U of A if it doesn’t get acted on,” said Morgan Abraham, president of the Associated Students of the University of Arizona. “I think this is the one issue that every student can kind of agree on and want something done … at the rate its going right now, nothing is going to happen.”

The letter to Congress begins by explaining that student debt is skyrocketing, now exceeding $1 trillion with the average student holding $27,250 in loans by graduation day.

“This enormous level of student debt weighs heavily on students, our families and our economy, forcing young Americans to delay major life decisions like buying a home or starting a family,” the letter said. “Our classmates and their families represent a broad range of ideologies and backgrounds. However, the vast majority of students on our campuses are rallying again, like we did last year, around the belief that everyone should have access to an affordable, world-class education.”

Finding a permanent solution to the problem is the most important goal, said Jordan Davis, student body president of ASU, Tempe.

“It’s a serious concern, especially when you’re looking at you know, tough economic times, and tough career opportunities after you graduate…,” Davis said.

This weekend, campus leaders were invited to attend a conference hosted by the National Campus Leadership Council and held in Washington, D.C. NCLC is an organization that “empowers student body presidents to leverage campus ideas to influence national policy and opinion by connecting with each other and national leaders,” according to its website. Both Abraham and Makenzie Mastrud, student body president of NAU, attended.

“The one thing I really appreciated about it was it was information based,” Abraham said, “And not so much partisan based you know, they were just feeding us information, letting us know everything that’s going to be affecting students next year, so it was incredibly helpful.”

On Monday, Abraham said he met with Arne Duncan, the U.S. Secretary of Education, and went to the White House to speak with several of Obama’s aides about what is happening with the interest rates bill. Abraham also met with several aides from the Arizona delegation, to speak with them about the letter he signed and to share ASUA’s perspective.

“There’s a lot of options that can happen in the future,” Abraham said. “What we’re kind of reiterating is that there’s not really enough time for some sort of long term game plan to come through [by Monday], you know, they’ve waited this long, it’s their fault, but you can’t let students be punished for this.”

The campus leaders’ letter concludes that if a long-term plan proves “politically impossible,” campus leaders support a short-term extension of the current 3.4 percent interest rate, until a time when comprehensive reform proves politically viable.

“I believe that eventually a long-term solution will come and hopefully it will be bipartisan and hopefully the students will love it,” Abraham said, “But there’s no way we have enough time right now to figure that out.”

Source: Arizona PIRG
Current rate: 3.4 percent
Doubled rate: 6.8 percent
Number of affected students in Arizona: 450,977
Dollar increase: Approximately $902