Plusses and Minuses on Student Loan Interest Rate Freeze
Today, students are struggling to pay off student loans and this tight job market isn’t helping. Many are living with parents, delaying marriage, and taking other actions to pinch pennies so they can pay off their student loans.
The student loan interest rate was about to expire at the end of June 2012, resulting in a nearly doubled rate of seven percent. However, Congress legislated to freeze rates at their current 3.4 percent level for federally subsidized student loans taken during the 2012-2013 school year. While students sighed with relief, this new deal came with stipulations.
Downside of the student loan deal
The downside is—
- Students without a high school degree or GED (General Educational Development or popularly coined General Equivalency Diploma) do not qualify for the loans
- In one year this deal expires
- The previous six-month grace period after graduation where interest did not accrue does not apply to the new deal
More on the upside
Jump-starting a career immediately after graduation so you can begin paying off your loan may be a difficult feat. Although students have a new worry about the lack of an interest grace period after graduation, there is an upside to keep in mind. Because of the interest rate freeze, your debt does not increase by $1,000 every year you borrow. This is a significant savings.
Bankruptcy law firms have a wealth of knowledge about all kinds of debt problems and can offer you valuable solutions. Harold Shepley & Associates offers a free consultation to discuss your financial dilemmas and is a full service debt relief law firm in Pennsylvania.
August 2, 2012 Posted in Debt, Student Loans Tagged bankruptcy law firm, debt relief law firm, interest rate, student loan Leave a comment
