Students and faculty met outside the Student Resource Building on Wednesday to hear Lois Capps speak about the proposed doubling of Stafford student loan interest rates. Stafford Loan interest rates are set to double on July 1 from 3.4 percent to 6.8 percent unless Congress extends legislation to keep the rates at current levels.
California Congresswoman Lois Capps spoke about her concern for this increase and the burden it would place on university students.
“When you graduate today, it’s estimated that you have the highest loan package that we’ve ever had students face. That’s nothing to be proud of in terms of your country,” said Capps. “When you graduate from college, we want to make sure that you’re ready to work and that you have the opportunity to go on to school if you want to without the fear of piling on to your debt.”
Total student loan debt recently passed the $1 trillion mark, moving above the nation’s credit card debt, and the average student loan debt is over $25,000. It is estimated that if Stafford Loan interest rates increase, students will pay an average of $1,000 more per year. For many, this debt necessitates delaying life milestones like marriage and children.
“The college debt increasing as it has makes it hard for you to launch your careers, your businesses, start a family,” said Capps. “How could you ever think of buying a house when you have the size of a mortgage hanging over your back already with a student loan?”
University of California Santa Barbara student and policy analyst Dustin Foster spoke on his own experiences with student loans and how, though he avoided loans during his undergraduate career, the increasing interest requires him to reevaluate attending graduate school.
“I need to find an alternative way to fund my education,” said Foster. “Obviously, loans are kind of the only answer given the substantial cost of going to graduate school… The extension of this 3.4 percent interest rate would make education more affordable and attractive.”
Foster stated that keeping the interest rate at current levels encourages stability and affordability, will encourage people to attend a university, and encourage net benefits to the economy as a whole.
Nadim Houssain, newly elected Associated Students external vice-president of statewide affairs, also spoke to the crowd, using his personal experiences and new position to address the issue of rising University of California costs.
“It’s called a public education because it’s meant to be accessible to every single student in the state that wishes and aspires to an education,” said Houssain. “Under the UC Master Plan for Education, we are not meant to pay a single penny for our education and yet now we are graduating with tons of debt. This is unacceptable.”
Houssain also spoke of his own experiences.
“There are students that are working two jobs in addition to trying to get good grades just so they don’t have to pay, they don’t have to take in and incur all this debt,” said Houssain. “I know personally of my friends that have dropped out of school because they couldn’t afford it anymore and that’s unfortunate.”
The Director of the Financial Aid Office Mike Miller spoke about his involvement in this issue.
“As the director of Financial Aid and Scholarships here at UCSB providing students with affordable student loans is a very important issue to me,” said Miller. “Over the last 10 years, cost of education at UCSB has more than doubled. The skyrocketing cost of higher education has driven many students to seek financial aid, more than ever before.”
Capps and the other speakers spoke individually with students after the speeches, offering their ideas and listening to suggestions offered by students and faculty. Throughout the event, Capps restated her dedication to reducing the cost of education.
“Lower interest rates on student loans gives you a shot at an affordable- a little bit more affordable- college education where you can get the skills to find a good job,” said Capps. “It gives America a path to grow. We need to stop the interest rate from doubling. It’s that simple.”