College students react to possible increase in loan interest rates
Thu, 26 Apr 2012 23:55:00 GMT —
Armando Lopez told Action 4 News there was never any question that he would have to take out a student loan to make his dream of obtaining a college degree a reality.
"I want to pursue my career, said Lopez. I want to go for it.
When he first applied for a student loan the 3.4 percent interest did not seem like a bad deal.
"It looked kind of good, said Lopez. When I checked the rates I thought, this is good and I can afford to pay this in the future."
But now that rate is in danger of doubling to 6.8 percent by July 1st. This is something, Lopez said, that could derail his plans for higher education.
"It does really scare me. What if it goes higher?" said Lopez.
He is not alone.
Blanca Villarreal does not currently have student loans, but she may need to apply for some in the future.
"We don't have the free finical aid or any help for some of us, Villarreal said. Getting loans every semester will increase what we have to return." The University of Pan American Associate Director for Outreach and Customer Services, Jael Garcia said if an extension is not passed by Congress"students will feel the effects forcing some to stop in their educational tracks.
"Education is an investment, Garcia started. There are a lot of statistics that show the earning potentials of those who have a high school diploma versus a bachelors degree or associates degree."
Garcia said, despite this possible increase in interest for subsidized student loans---descent repayment plans are usually offered.
"Usually the federal government does work very well with students that are in the repayment portion." said Gonzalez.
In the long run, Garcia said, education does pay off if the students pays into it now.