Lazy Congress Causes New Student Loan Rates to Jump
Matt | On 08, Jul 2013
Congressional inaction knows no limits these days.
In the wake of the Fourth of July holiday, lawmakers will return to Washington to face the issue of federal student loan rates that have doubled. It’s not that the problem got out of hand and Congress has arrived to fix it. Nope! They simply never addressed the issue and now it’s staring them in the face.
Students who apply to receive federally subsidized school loans after July 1 are now hit with rates going from 3.4 to 6.8 percent. The good news is that Congress still has a few more weeks before fall semester starts at many schools and the rush of students signing loan forms happens.
However, the laziness of Congress is plain to see and MUST be called out.
Lucky for students, Congress does want to do something about the rate hike. No one wants the blame for rising student loan rates to affect their party. It has been said that Congress will vote soon on a one-year extension of the current 3.4 percent rate.
The rate hike is part of the automatic sequester cuts that took effect on March 1. The cuts are designed to reign in government spending as a last resort “agreement” between Republicans and Democrats.