I-C-S-A waives fee on student loans

While the cost of a college education continues to go up, one avenue of paying for the sheepskin isn’t changing. Tim Fitzgibbon of the Iowa College Student Aid Commission says the organization is extending the four-year waiver of the one-percent origination fee on student loans. The fee is used to pay for those students who default on loans.They have an adequate reserve fund to cover any defaults, that’s why they’re waiving the fee. Fitzgibbon says it adds up to a lot of money saved for Iowa students.He says they guarantee roughly 300-million dollars in loans, so the origination fee would’ve been around three million dollars. He says the move helps students by giving them more money to spend on books and fees.Iowa has traditionally had a low default rate on student loans compared to the nation. Last year, Iowa’s rate was five-and-a-half percent. Fitzgibbon says that’s partly due to good schools in the state.He says the work ethic of Iowans is also a big part of it. Fitzgibbon says the commission will have to keep an eye on the default rate with the recent slowdown in the economy. Students are borrowing more now on credit cards and all kinds of debt, and he says that makes it difficult for them to keep up.