Student Loans

Student Loans

College costs are growing rapidly and financial aid hasn’t kept up. Close to 70 percent of undergrads graduate with debt. In 2009, the average student borrower owed $27,600.  The Student Aid and Fiscal Responsibility Act (SAFRA) of 2010 ensures that all federally funded student loans will be directed through the federal government’s Direct Loan Program (DLP,) saving $61 billion and using that money to fund increased Pell Grant funding.  SAFRA abolished the Federal Education Loan Program (FFELP), which used subsidized loan companies to provide student loans. 

Cry Wolf Quotes

This bill is a massive expansion of the Federal Government, pure and simple.

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Alexa Marrero, spokesperson for Representative John Kline (R-MN), the chairman of the House Education and Labor Committee. Time magazine.

Here is what they haven't told us: The Education Department will borrow money at 2.8 percent from the Treasury, lend it to you at 6.8 percent and spend the difference on new programs. So you'll work longer to pay off your student loan to help pay for someone else's education -- and to help your U.S. representative's reelection.

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Senator Lamar Alexander (R-TN) published this anti-SAFRA op-ed in The Washington Post.

For decades, Sallie Mae has done great work to support millions of students and families and that is felt right here in Central Indiana through employment opportunities and economic development. With unemployment in our region at more than 10 percent, these are jobs we can’t afford to lose.

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Scott Faultless, President of the Fishers Town Council.

CBA also disputed administration claims that eliminating the FFEL program would not result in poorer customer service to students and parents. More than 30,000 people are currently involved in helping students via the FFEL program. These experts understand students' loan obligations and how to get students the help they need when facing difficultly in repaying their loans. Firing them and hiring some untrained replacements, as the President proposes, would be a huge setback for educational opportunity.

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The Consumer Bankers Association’s Director of Government Relations, Marcia Z. Sullivan. Consumer Bankers Association’s press release.

Evidence

Resources

Campus Progress is the youth wing of the Center for American Progress. They do work in both advocacy and journalism.

Higher Education Watch is the New America Foundation's blog about the politics and policy of higher education.