New York Daily News
College loan interest rates will soar, affecting thousands of students citywide, if Congress doesn’t act immediately, according to a new report released by the Center for American Progress.
About 420,000 college students in New York State will have to pay more than $340 million extra in interest if the rates on Stafford loans double from 3.4% to 6.8%, according to the report.
“We could have prevented this from doubling,” charged Sen. Kirsten Gillibrand (D-N.Y.) on a conference call with reporters on Tuesday. “When we price our young people out of higher education, we all pay the price. We rob ourselves of a future engineer or biologist or teacher.”
Jillian Sesenton, a master’s student at Fordham University, said she will be close to $200,000 in debt once she finishes her thesis this year, between her undergraduate and graduate programs. She started college at 28 after scraping up money from odd jobs.
“I’m excited to graduate, but I know what’s waiting for me in the end,” said Sesenton, now 38. According to the report, the median student borrower age went from 35 in 2007 to 39 in 2009.
“I have no idea how I’m going to manage to pay these loans,” continued Sesenton, who grew up in the Patterson Houses in Mott Haven. “If they double the interest rates to 6.8%, I’m going to be completely broke. I don’t know how I’m going to survive.”
Congress established the low interest rates in 2007 over a period of five years. The bill to keep the existing rate for another year was blocked by Republicans in the Senate, making the issue another instrument for partisan bickering.
Students at the city and state universities of New York may face more hikes on top of the federal loan threat after a tuition increase goes into effect.
“Especially with the tuition increases we’re seeing at SUNY and CUNY, and the interest rates we’re seeing on top of that, is really a double whammy for students,” said Karen Scharff, executive director of Citizen Action of New York.
Starting next fall, all CUNY students will pay $300 extra annually for five years, bringing the in-state tuition to $6,330 a year after a five-year hike.
“Let’s keep (college) affordable,” pressed Gillibrand. “There’s no excuse for inaction. There’s real concern on how to move forward here.”