Refinance student loans Aberdeen

March 28, 2016
Will Your Student Loan Affect

A group of Senate Democrats flanked by college students touted their solutions to the student debt crisis Thursday.

Senators Elizabeth Warren (D-Mass.), Patty Murray (D-Wash.), Tammy Baldwin (D-Wisc.), Chuck Schumer (D-N.Y.) and others announced a package of legislation they say will make higher education more affordable for future college students and help borrowers currently struggling with debt better manage their burden.

The package, dubbed the RED Act, a reference to a campaign that activists and members of Congress launched on social media during the State of the Union speech last week to help students and borrowers who are “#InTheRed, ” hashtag includes three proposals that various Senate Democrats have championed in recent years.

The first proposal is a federal-state partnership that would waive resident tuition for two years of community college. Under the bill, for every $1 a state puts in to make community college free, the federal government would provide $3. The package also includes a proposal that would index the Pell grant — the money the government provides to low-income students to attend college — to inflation and provide mandatory funding for the program. The third component of the bill would allow current student loan borrowers to refinance their loans at lower interest rates.

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“The consequence of this huge student loan burden is being felt throughout the nation, ” Warren said at the news conference of the $1.3 trillion in outstanding student loan debt. “It is crushing the dreams of young people and it is crushing their ability to build a future that has some real economic security.” She estimated that if the cohort of federal student loan borrowers who went into repayment this year were able to refinance their loans they would save $655 million.

The package of legislation has a long road ahead before becoming law. Republicans have shut down previous proposals led by Warren to allow borrowers to refinance their student loans. They’ve also blocked earlier legislative efforts to make two years of community college free, a proposal first put forth by President Barack Obama last year.

“Right now I’m hearing a lot of ideas on our side to try to make college affordable for hardworking people and I don’t hear anything from Republicans except ‘no, ’” Warren said during the news conference.

Republicans on the presidential campaign trail have voiced some support for allowing borrowers to refinance their loans at lower rates. But congressional Republicans and many in the party’s presidential field favor an approach to college affordability that emphasizes encouraging competition in the higher education space from alternative providers and less federal government involvement in both the student loan system and higher education funding.

Source: www.marketwatch.com
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