2008 Woodie Awards
Congress takes first step in addressing college affordability
Courtesy of the Campaign for College Affordability
Issue date: 10/17/07 Section: News
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Shortly after many college students headed back to class for a new school year, Congress passed and the President signed the largest increase in federal student aid since the GI bill in a crucial move to make college more affordable for many students and their families.
The major provisions of the act include increasing the maximum Pell Grants by $1,000 to help low and moderate income students and rolling back interest rates on subsidized Stafford Loans from the current 6.8 percent to 3.4 percent over a five year period to help borrowers. The legislation also provides for income- based repayment of student loans, which will help make student loans more manageable as graduates take on their student loans with entry level salaries. And many students interested in traditionally lower paying public service careers will have their remaining loan balance forgiven if they remain in a public service career and make responsible loan repayments for ten years. By expanding loan forgiveness for borrowers in fields such as teaching, nursing, and social work, borrowers are encouraged to pursue career fields dictated by their passions rather than their level of student loan debt. The legislation was overwhelmingly passed by Congress (Senate 72-12, House 292-97).
This Congressional action was a reaction to the rising cost of college and the increasing debt burden taken on by students and their families. From 2000 to 2006, the total cost of a public four-year college increased $2,160; the total cost of a private four-year college increased $1,110; and the median income fell $957. The average level of debt incurred by a college student stands at $19,000. In some states, which include Ohio, New Jersey, Iowa, Oregon, Washington and Illinois, more than 30 percent of a family's annual income is needed to pay net college costs of a public four-year institution. This level of debt, seen as unmanageable by many, prevents more than 400,000 academically qualified students from pursuing a four-year college education each year.
The major provisions of the act include increasing the maximum Pell Grants by $1,000 to help low and moderate income students and rolling back interest rates on subsidized Stafford Loans from the current 6.8 percent to 3.4 percent over a five year period to help borrowers. The legislation also provides for income- based repayment of student loans, which will help make student loans more manageable as graduates take on their student loans with entry level salaries. And many students interested in traditionally lower paying public service careers will have their remaining loan balance forgiven if they remain in a public service career and make responsible loan repayments for ten years. By expanding loan forgiveness for borrowers in fields such as teaching, nursing, and social work, borrowers are encouraged to pursue career fields dictated by their passions rather than their level of student loan debt. The legislation was overwhelmingly passed by Congress (Senate 72-12, House 292-97).
This Congressional action was a reaction to the rising cost of college and the increasing debt burden taken on by students and their families. From 2000 to 2006, the total cost of a public four-year college increased $2,160; the total cost of a private four-year college increased $1,110; and the median income fell $957. The average level of debt incurred by a college student stands at $19,000. In some states, which include Ohio, New Jersey, Iowa, Oregon, Washington and Illinois, more than 30 percent of a family's annual income is needed to pay net college costs of a public four-year institution. This level of debt, seen as unmanageable by many, prevents more than 400,000 academically qualified students from pursuing a four-year college education each year.
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