The training Department’s proposal to begin with asking a variable interest rate in the place of a predetermined, low rate so you’re able to consumers exactly who combine numerous government figuratively speaking on the a person is a “feasible selection for reducing government costs” in student loan software, the new You.S. Bodies Accountability Work environment said for the a february page in order to Republican lawmakers, who had requested the new opinion.
The training Department’s proposal to begin with asking a variable interest in place of a predetermined, low-rate so you can individuals which blend several federal student education loans towards the you’re a beneficial “feasible selection for reducing federal will set you back” into the education loan apps, new You.S. Bodies Accountability Workplace told you in the a february page to help you Republican lawmakers, that has requested the latest comment.
In its funds suggestion for the 2006 fiscal season, the brand new Plant management recommended a suggestion — to start with put forward by Domestic Republicans in the regulations to increase the new Advanced schooling Operate — who would pay for an increase in new Pell Grant System mostly owing to a series of alterations in how two government education loan applications try managed, including the change so you’re able to an adjustable interest rate about program to possess consolidating financing. Advocates for college students strenuously oppose particularly a significant difference, and that whenever you are preserving the federal government currency will ratchet up the costs to help you consumers.
The newest GAO provided research where reviewed numerous an effective way to keep costs down about mortgage program, and you can advised the loan integration alter in general options. Rep. John A good. Boehner (R-Ohio), president of the house away from Agencies Committee for the Degree additionally the Employees, requested the brand new GAO so you can reassess the problem observe “if or not monetary things — such as for instance most recent and projected rates — was in a way that a variable rate of interest stays a viable option to own cutting federal can cost you away from education loan consolidation.” The answer remains sure, the GAO page says.
Share Article
For the a news release on Home degree committee, Boehner told you: “It’s time having Congress so you can adhere this new warnings of your GAO, and you will address the latest ballooning costs of one’s consolidation financing program — an application that will not suffice children, but large income school graduates. We need to heal the focus of your own Higher education Act in order to the present day and you may future lower and you may middle-earnings youngsters it actually was intended to suffice.”
Nevertheless the Family press release generally seems to overstate the new GAO’s conclusions sometime, proclaiming that brand new accountabilty office “continues to suggest varying interest rates.” Because the letter continues to advise that adopting the changeable rate are an effective “viable choice” having cutting government costs, it looks to stop really in short supply of suggesting that government in reality bring one action.
An effective spokesman for Agent. George Miller away from Ca, the big Democrat toward Family degree committee, said the new Congressman had not heard of GAO letter and may even perhaps not comment on it. However, he noted a recent Congressional Budget Office data discovering that “carried on so that children the option to help you consolidate its money within the lowest repaired price will surely cost $255 mil along the 2nd ten years,” less than the guess Republicans features given.
New spokesman extra: “Representative. payday loans Akron OH Miller strongly thinks that people must do everything you’ll and also make school less expensive for students — believe it or not affordable — so he’d maybe not help elimination of the modern lower repaired price integration work with.”
Doug Lederman
Doug Lederman is editor and co-founder of Inside Higher Ed. He helps lead the news organization’s editorial operations, overseeing news content, opinion pieces, career advice, blogs and other features. Doug speaks widely about higher education, including on C-Span and National Public Radio and at meetings and on campuses around the country, and his work has appeared in The New York Times and USA Today, among other publications. Doug was managing editor of The Chronicle of Higher Education from 1999 to 2003. Before that, Doug had worked at The Chronicle since 1986 in a variety of roles, first as an athletics reporter and editor. He has won three National Awards for Education Reporting from the Education Writers Association, including one in 2009 for a series of Inside Higher Ed articles he co-wrote on college rankings. He began his career as a news clerk at The New York Times. He grew up in Shaker Heights, Ohio, and graduated in 1984 from Princeton University. Doug lives with his wife, Kate Scharff, in Bethesda, Md.