Congressman Bruce Braley says the U.S. House has passed major legislation that will ensure interest rates on many student loans do not balloon in a few years. “It keeps interest rates low on need-based or subsidized federal student loans,” Braley says. “…They’re currently set to jump from 3.4% to 6.8% in 2012 and so this change will keep interest rates low. We know that in 2008 there were 225,000 students in Iowa who used subsidized student loans.”
The Student Aid and Fiscal Responsibility Act passed the House this afternoon. It would put 40-billion more dollars in the Pell Grant program to increase the maximum Pell Grant. “And starting in 2011 the scholarship will be linked to match rising costs of living by indexing it to the Consumer Price Index plus one percent,” Braley says.
According to Braley, over 17,000 Iowa students will be eligible for a Pell Grant in the next academic year. The bill would boost the amount of money available for Perkins grants which are generally awarded to those who are seeking technical or vocational degrees. Braley, though, says the bill’s most significant move is curbing the looming interest rate boost for general student loans.
“I have three kids in college right now. I know how important this is,” Braley says. “It helped me get a college education.” Braley, a Democrat from Waterloo, earned an undergraduate degree from Iowa State University and a law degree from the University of Iowa and Braley relied on student loans to get those degrees.